»Ê¹ÚÌåÓýapp

As described at TTM06001 onwards, relevant shipping profits are replaced by tonnage tax profits in a tonnage tax company’s corporation tax computation.

»Ê¹ÚÌåÓýapp tonnage tax regime is tightly ring fenced to ensure that

• only income and expenses that properly belong to ship operating or management activity are included within relevant shipping profits, and
• all other income and expenses are taxed under the normal Corporation Tax rules.

»Ê¹ÚÌåÓýapp general ring fence provisions described in this chapter cover a range of issues:

• In order to facilitate the separation of relevant shipping profits from other profits a company will begin a new accounting period when it enters or leaves tonnage tax, see TTM07010, and a company’s tonnage tax activities are deemed to be a separate trade distinct from its other activities, see TTM07020.
• Controlled Foreign Companies may be carrying on shipping trades which would be qualifying trades if the CFC were resident in the UK. »Ê¹ÚÌåÓýappre are special rules to deal with the treatment of dividends received by, or amounts apportioned to, UK companies, see TTM07100.
• Tonnage tax is designed to produce a minimum level of tax, and there are special rules to prevent deductions being made from tonnage tax profits, or against the tax on those profits, see TTM07200.
• »Ê¹ÚÌåÓýapp general transfer pricing rules are extended to cover transactions across the tonnage tax ring fence, see TTM07300.
• »Ê¹ÚÌåÓýappre are special rules to prevent a company or group charging a disproportionate amount of its finance costs outside the ring fence, see TTM07400.

Other aspects of the ring fence, dealt with elsewhere in this manual, are

• »Ê¹ÚÌåÓýapp ring fence: Capital allowances: General, see TTM09001Ìý´Ç²Ô·É²¹°ù»å²õ.
• »Ê¹ÚÌåÓýapp ring fence: Capital allowances: Ship leasing, see TTM10001Ìý´Ç²Ô·É²¹°ù»å²õ.

References