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A non-UK resident company dealing in or developing UK land Ìýwill come within the charge to corporation tax on making a disposal of UK land or property on or after 5 July 2016.

Generally ‘large� companies must pay their Corporation Tax electronically by quarterly instalments. A large company is one whose profits for the accounting period in question are at an annual rate of more than £1.5 million.

An exception to the requirement to pay by instalments for ‘large� companies exists where the profits for an accounting period do not exceed £10m and at any time during the previous 12 months the company was outside the charge to UK corporation tax.

It follows that when a non-UK resident company does not have annualised profits over £10m when it first comes within the charge to UK corporation tax it will not initially be required to pay corporation tax by instalments.

Guidance on paying corporation tax in instalments can be foundÌýhere

Example 1:

Company A is non-UK resident and comes within the charge to corporation tax on making a dispoal on 1 August 2016. Ìý»Ê¹ÚÌåÓýapp company prepares its accounts to the 31 December 2016. Company A’s first UK accounting period therefore runs from 1st August to 31 December 2016 and profits for that period are £3m. Annualised profits are therefore just over £7M, so do not exceed £10M. Company A is a ‘largeâ€� company for instalment purposes but it did not have an accounting period for corporation tax purposes prior to 1st August 2016 and its profits for the accounting period do not exceed £10m. Company A will not be required to pay by instalments for its accounting period ending 31 December 2016.

Example 2:

Company B is non-UK resident and comes within the charge to corporation tax on the 1st August 2016. »Ê¹ÚÌåÓýapp company prepares its accounts to the 31st December 2016 and its annualised profit is £25m. As Company B’s profits for its first accounting period for corporation tax purposes (1st August 2016 â€� 31 December 2016) exceed £10m the exception to not pay by instalments does not apply. Company B’s first payment will be due 6 months and 13 days after the first day of its accounting period.