OT26115 - Capital allowances: ring fence expenditure supplement: accounting periods
CTA2010\S309
The company鈥檚 accounting periods for the purposes of the RFES are defined as follows.
The 鈥榗ommencement period鈥� is the accounting period in which the company sets up and commences its ring fence trade.
A 鈥榩ost-commencement period鈥� is any accounting period beginning on or after 1 January 2006
- which is the commencement period, or
- which ends after the commencement period.
A 鈥榩re-commencement period鈥� is any accounting period
- beginning on or after 1 January 2006, and
- ending before the commencement period.
Exceptionally, a company may start to carry out activities before it has an accounting period for tax purposes (CTA2009\S9). If a company incurs any expenditure but is not within the charge to corporation tax, it is treated for RFES purposes as if those activities were carried on in a trade. The company is then treated as having accounting periods commencing from the date on which that deemed trade started.
A 鈥榮traddling period鈥� of a qualifying company is an accounting period that begins before 1 January 2006 and ends on or after that date. The part of the straddling period that falls before 1 January 2006 and the part that falls after that date are treated as separate accounting periods for RFES purposes.