PART 1Income tax, corporation tax and capital gains tax

Rate of diverted profits tax

8Increase in the rate of diverted profits tax

1

In section 79 of FA 2015 (charge to diverted profits tax)—

a

in subsection (2)(a) (which sets the rate in a standard case), and

b

in subsections (3) and (3A) (which contain modifications of the rate in the case of ring fence profits or banking surcharge profits),

for “25%” substitute “ 31% ”.

2

The amendments made by this section have effect for accounting periods beginning on or after 1 April 2023.

3

The remaining provisions of this section deal with a case where a company has an accounting period (a “straddling period”) beginning before 1 April 2023 and ending on or after that date.

4

For the purpose of calculating the amount of diverted profits tax chargeable on a company for the straddling period—

a

so much of the straddling period as falls before 1 April 2023, and

b

so much of it as falls on or after that date,

are to be treated as separate accounting periods.

5

If it is necessary to apportion an amount for the straddling period to the two separate accounting periods, the apportionment is to be made on a time basis according to the respective lengths of the separate accounting periods.