Corporation Tax Act 2010 section 981

Exemption for trade unions and eligible employers' associations

Section 981 provides a corporation tax exemption for trade unions and eligible employers' associations on their qualifying income and gains, subject to meeting conditions about the level of benefits they can provide and making a claim.

• Trade unions and eligible employers' associations can be exempt from corporation tax on qualifying income and gains, provided two conditions are met and a claim is made.
• The organisation must be prevented by its rules or by statute from assuring to any person a gross sum exceeding £4,000 or an annuity exceeding £825 (Condition A), and must make a claim for the exemption (Condition B).
• Only employers' associations that were in existence and qualified for the exemption in 1971 (or 1992 for Northern Ireland) are eligible — not all employers' associations qualify.
• The Treasury has the power to increase the £4,000 and £825 thresholds by order, and to specify which income or gains any such increase applies to.