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CTM15550 | Distributions: general: companies not carrying on a business

From HM Revenue & Customs · Company Taxation Manual

CTA10/S1071 applies where a company has never carried on a trade or a business of holding investments.

The distributions legislation applies to such a company only in respect of distributions that are made out of:

  • profits that are charged to Corporation Tax (less the CT on those profits), or

  • franked investment income.

This provision is important in relation to distributions of unincorporated associations, see CTM15540, which are not carrying on a business of mutual trading. See BIM24000 onwards.