Corporation tax for Paper P6 (UK) - part 3: self-test

Test your understanding

(1). RCO Ltd is a UK resident company. It is planning to set up a permanent establishment overseas. What must be true in order for a trading loss made by the permanent establishment to be offset against the income and gains of RCO Ltd?

(2). State whether the following statements are true or false.

A A UK resident company can elect to exclude the profits and losses of any of its overseas permanent establishments from UK corporation tax.
The profits of an overseas incorporated subsidiary that also trades overseas will not be subject to UK corporation tax unless the company is managed and controlled from the UK.