»Ê¹ÚÌåÓýapp

CTA2010/S1064 (3) (formerly ICTA88/S418 (4)) provides that the amount of expense to be taken into account under CTA2010/S1064 (1) and (2) (formerly ICTA88/S418 (2)) and CTA2010/S1065 (formerly ICTA88/S418 (3)) as a distribution shall be the same as would under ITEPA2003/Part 3 (formerly ICTA88/Chapter II of Part V) (see SE21001 onwards) be the cash equivalent of the resultant benefit.

»Ê¹ÚÌåÓýapp use of the income from employment rules is limited to the determination of the amount. It should not be taken as extending the scope of CTA2010/S1064 (1) and (2) beyond benefits provided by a close company for its participators (including participators in a company which controls it - CTM60107 and CTM60110) and their associates (CTM60150) in connection with which the close company itself incurs expense.

»Ê¹ÚÌåÓýapp following guidance should be followed to determine the amount to be treated as a distribution under CTA2010/S1064 (1) and (2) and S1065..

• Assets transferred to participator or associate, SE21640 (second to fifth subparagraphs) onwards.
• Assets used by participator or associate but not transferred:
  • Cars. »Ê¹ÚÌåÓýapp SE23004 scale charge applies, increased where appropriate, in accordance with SE23130 and SE23131.
  • Accommodation. Strictly the measure of the benefit is that provided by ITEPA2003/S203 to S207 (formerlyICTA88/S156 (5), (6) and (7)). In practice the guidance at SE11431 may be followed as this gives the same result.
  • Cheap loans. Enquiries about the possible application of CTA2010/S1064 in relation to benefits derived by close company participators and their associates from interest free or low interest loans should be referred to CT&VAT (Technical).