CTM15340 | Distributions: general: LEAs, LECs & TECs

CTA09/S82 provides tax relief for contributions made to LEAs, LECs and TECs aimed at encouraging enterprise - see BIM47610.

A company owned by:

• a Local Enterprise Agency (LEA), or

• a Local Enterprise Company (LEC), or

• a Training and Enterprise Council (TEC),

may make contributions to its parent which may be treated as distributions.

CTA09/S82 provides tax relief for contributions made to LEAs, LECs and TECs.

For contributions made before 17 July 2012, CTA10/S1002 and S1021 prevented distribution treatment applying where

• a company is a 51 per cent subsidiary of an LEA, LEC or TEC, and

• the LEA, LEC or TEC and the company are bodies corporate, and

• the company makes contributions to the LEA, LEC or TEC.

This prevention did not however apply where the LEA, LEC or TEC was not a body corporate. For contributions made on or after 17 July 2012, CTA10/S1002 and S1021 are repealed and contributions by the company to the LEA, LEC or TEC may give rise to distributions in all cases.