Section 837C | Charge to income tax on winding up receipts

(1)Winding up receipts arising from the deposit-taking trade are chargeable to income tax.

(2)Subsection (1) applies in relation to a winding up receipt only so far as its value was not brought into account in calculating the profits of the trade of any period before the permanent cessation of the trade.

(3)A “winding up receipt” means (subject to subsection (4)) a sum received by the company or its liquidator after—

(a)the start of the winding up proceedings, or

(b)if later, the permanent cessation of the deposit-taking trade.

(4)The following are not winding up receipts—

(a)a sum received on behalf of a person entitled to the sum to the exclusion of the company and its liquidator, and

(b)a sum realised by the transfer of an asset required to be valued under section 173 of ITTOIA 2005 (valuation of trading stock on cessation).