Corporation Tax Act 2010 section 202B

Restriction on relief for payments to community amateur sports clubs

Section 202B restricts the corporation tax relief available when a company owned or controlled by a community amateur sports club (CASC) makes qualifying payments to that club while also incurring inflated member-related expenditure.

• Where a company owned or controlled by a CASC makes qualifying payments to the club and incurs inflated member-related expenditure in the same accounting period, the relief on those payments is reduced by the amount of that inflated expenditure (but not below nil).
• If the inflated member-related expenditure exceeds the qualifying payments made in the current period, the excess can be carried back to reduce qualifying payments in earlier accounting periods, going back up to six years, starting with the most recent year first.
• A CASC controls a company if it can direct the company's affairs through shareholdings, voting power, or powers in the company's articles of association; two or more charities (including the CASC) are treated as controlling the company if they can collectively do the same.
• Any necessary adjustments, including amended assessments, must be made to give effect to the carry-back of excess inflated member-related expenditure to earlier periods.