Corp Tax - Chapter 13

Question 1

Investment Company

Answer 1

‘company whose business consists wholly or partly of making investments’.

Question 2

Management Expenses - are they deductible and when?

Answer 2

Management expenses are deductible against the total profits of a company with
investment business.

The expenses will be deducted based on when they are debited in the accounts.

Question 3

Are capital expenses allowed?

Answer 3

No unless they are Capital Allowances

Question 4

Examples of management expenses…

Answer 4

i. Commissions paid to agents, such as stockbrokers who manage the portfolio
of shares.

ii. Capital allowances on plant used to manage the investments, such as
computer equipment used to monitor the progress of the investments.

iii. Reasonable salaries, which includes redundancy costs.

iv. Premises costs, eg relating to the offices used to manage the investments.

v. Audit and accountancy costs

Question 5

Are management expenses before or after QCD?

Answer 5

Before