CTM40580 | Particular bodies: registered societies: agricultural and fishing co-operatives treated as registered societies
From HM Revenue & Customs · Company Taxation Manual
and S1058,
and define a ‘UK agricultural or fishing co-operative’ as a co-operative association (which may be an incorporated company or an unincorporated association) that is
• established in the UK and UK resident, and
• carrying on agricultural or horticultural business on land occupied by them in the UK, or
• carrying on business consisting of the catching of fish or shellfish.
For this purpose a co-operative association means a body with a written constitution from which the Secretary of State is satisfied that it is in substance a co-operative association..
Such associations receive similar treatment to registered societies as regards interest and share dividends – . See .
In the hands of the members share interest is treated as interest for tax purposes, .
Where such a co-operative association claims exemption from tax on trading income on the grounds of mutual trading see onwards.
If two such associations amalgamate, a disposal of assets does not give rise to a capital gain chargeable to Corporation Tax.
An association that satisfies the appropriate authority receives a certificate to that effect and should be asked to produce it. Where the date from which an association qualifies is the commencing date of a CT accounting period, the relevant tax treatment – loan relationship debit () or deduction from profits () should be applied for that and succeeding accounting periods without further enquiry.
In other cases, the first accounting period for which should be applied is the accounting period succeeding that in which the date of qualification falls. Where an association to which a certificate has been granted ceases to qualify for this treatment (for example, because of a change in constitution), the responsible office is notified by BAI (Technical) of the effective date.