Corporation Tax Act 2010 section 357MB

Profit imputed to back-office activities

Section 357MB explains how to calculate the notional profit attributable to back-office activities within a qualifying Northern Ireland trade, using a simple percentage mark-up on allowable back-office costs.

• Back-office profits are calculated by applying a 5% mark-up to each allowable deduction relating to back-office activities and adding the results together.
• A back-office deduction is any cost the company can deduct in computing its trading profits for the period, provided that cost relates to back-office activities.
• The Treasury has the power to change the 5% mark-up rate by regulation, and may set different rates for different trades or different types of back-office activity.
• Any such regulations may also include incidental, supplemental, consequential and transitional provisions as appropriate.