D4.456 CFC and advance corporation tax
No advance corporation tax (ACT) is payable in respect of distributions made after 5 April 1999, but a company which has surplus unrelieved ACT at that date may (in certain circumstances and to a specified extent) be able to set it off against corporation tax liability for subsequent accounting periods1.
When a company makes a distribution after 5 April 1999, it has to calculate an amount of 'shadow ACT' which is 25% of the amount or value of the distribution, see D5.1612. Shadow ACT is set off against the company's corporation tax liability but does not reduce the
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