The following Tax practice note provides comprehensive and up to date legal information covering:
The charge to UK corporation tax applies to the profits of both UK and overseas property business.
A property business is one that generates income from land and includes every transaction entered into for that purpose.
A UK resident company is subject to corporation tax on the profits of both UK and overseas property businesses (save for any profits that are excluded under the foreign permanent establishments exemption).
A non-UK resident company is not, prior to 6 April 2020, generally subject to corporation tax on its UK property business, but may be subject to UK income tax under the non-resident landlords scheme. From 6 April 2020, a non-UK resident company is subject to corporation tax on its UK property business and UK property income.
Specific rules apply to the commercial letting of furnished holiday accommodation. These rules historically provided significantly more generous loss (and other) reliefs for furnished holiday letting than for other property businesses. However, the more generous loss relief has been restricted since 1 April 2011. The detail of these rules is outside the scope of this Practice Note.
For details of the income tax charge on property business, see Practice Note: Property income—the income tax charge
As explained in The charge to corporation tax on income each type of taxable income is only brought into charge
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This Practice Note explains certain common financial covenants used in commercial finance transactions including:•minimum net worth test•gearing ratio•leverage ratio (or debt to equity ratio)•current ratio (or acid test ratio)•cashflow ratio•interest cover ratio, and•loan to value ratioIt explains:
Source of the doctrine of the separation of powersThe origins of the doctrine are often traced to John Locke’s Second Treatise of Government (1689), in which he identified the 'executive' and 'legislative' powers as needing to be separate.‘… it may be too great a temptation to human frailty, apt to
Disposal and devolutionThe equity of redemption arises as soon as the mortgage is made. It is an interest in the land which the mortgagor can:•transfer, lease or mortgage inter vivos, or•by will (it passes on intestacy)No cloggingIt is a fundamental principle of a mortgage that there must be no clog
Definition of automatismAn act is done in a state of automatism if it is done by the body without control by the mind, (eg it is a spasm or a reflex), or if it is done by a person who is not conscious of what they are doing. The act may be described as involuntary, but will not be regarded as such
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