Section 221 Substance based income exclusion for investment entity

United Kingdom

(1)

The substance based income exclusion for an investment entity is to be determined by adding together—

(a)

the payroll carve-out amount of the entity, and

(b)

the tangible asset carve-out amount of the entity,

(2)

Section 195 (4) applies to the determination of the payroll carve-out amount of the entity as it applies for members of the group that are not investment entities.

(3)

Section 195 (5) applies to the determination of the tangible asset carve-out amount of the entity as it applies for members of the group that are not investment entities.

(4)

If the filing member for the group elects not to calculate the substance based income exclusion for the period in a self-assessment (see F1Schedule 14), the exclusion is nil.

(5)

Paragraph 2 of Schedule 15 (annual elections) applies to an election under subsection (4).

Annotations

Textual amendments

F1: Words in s. 221(4) substituted (22.2.2024 with effect for accounting periods beginning on or after 31.12.2023 in accordance with Sch. 12 para. 1(2) of the amending Act) by Finance Act 2024 (c. 3), Sch. 12 para. 55(2)

Notes on Part 3

Modifications

C1: Pt. 3 modified (2.12.2025) by Finance Act 2026 (c. 11), Sch. 8 paras. 32, 53(3)