Paragraph 5

Section 548 (distributions: liability to tax) is amended as follows.

In subsection (5) after “2009)” insert “ so far as the distribution is a distribution of exempt profits ”.

In subsection (6) after “2005)” insert “ so far as the distribution is a distribution of exempt profits ”.

After subsection (8) insert—

“(9)

This section does not apply in relation to a distribution falling within section 549A(6) or (8) so far as the distribution is a distribution of exempt profits.

(10)

For the purposes of this Chapter a distribution is a “distribution of exempt profits” so far as the distribution falls within section 550(2)(a), (aa), (c) or (d).

(11)

In applying section 550 for the purposes of subsection (10) in relation to a distribution made by the principal company of a post-cessation group or by a post-cessation company—

(a)

subsection (1)(a) is to be read as referring to the principal company of the post-cessation group, or (as the case may be)

(b)

subsection (1)(b) is to be read as referring to the post-cessation company.”