D1.316 What tax relief is available for charitable donations made by a company?
A qualifying charitable payment (D1.317) made by a company, whether or not resident in the UK, is deductible from total profits, subject to certain restrictions. There is no need for the company to make a claim for this treatment1.
Total profits are taxable profits as reduced by the following reliefs:
• deficits on non-trading loan relationships, see D1.7402
• unrelieved trading losses, see D1.11043
• UK property business, see B6.2034
• surplus capital allowances in respect of 'special leasing', see B3.3805
The set-off for UK property business losses is mandatory; the other set-offs have to be claimed.
After making those set-offs, and before any allowance for group relief and group relief for carried forward losses, the qualifying charitable donations paid in the period are deducted, limited to the amount needed to reduce the total profits to nil6. This deduction is mandatory and does not have to be claimed.
Qualifying charitable donations may be set off against an assessment to tax on apportioned profits of a controlled foreign company; the set-off must be claimed