CTM09525 - Corporation Tax: relief for expenditure on grassroots sport - CTA10/PART6A: operation of CTA10/PART6A
Source: gov.uk (2025-07-18)


Relief under CTA10/PART6A operates in a way similar to the relief for charitable donations under CTA10/PART6 (see CTM09005 (https://www.gov.uk/hmrc-internal-manuals/company-taxation-manual/ctm09005)).

The Corporation Tax (CT) relief for contributions to grassroots sports is deducted from the company’s total profits in calculating the corporation tax chargeable for the accounting period in which the payment is made. If the payment is refunded, the deduction is not available. If any part of the payment is refunded, the deduction must be adjusted accordingly so that only the part of the payment that is not refunded attracts the deduction.

If a company makes a payment to support amateur sport out of payments that it has itself received for those purposes (for example, a grant from a local authority or an educational trust), it may only deduct any payment that it makes out of an amount that it has brought into charge to CT – CTA10/S217A (5).

For example, a company makes a qualifying payment of £5,000 to a sport governing body. The company will be eligible for a deduction of £5,000 under CTA10/PART6A. If the governing body brings this amount into charge to CT it may then claim a deduction for any payment made out of that amount for qualifying purposes. However, if the receipt is not taxable income in its hands it cannot then claim a deduction when it uses those funds to make payments to support grassroots sport.

This rule operates across accounting periods, such that an amount received in one period can be taken into account in considering whether a payment made in a later period is allowable.

In all cases, the amount of the deduction is limited to the amount that reduces the company’s taxable profits for the accounting period to nil – CTA10/S217A (6). If, as a result, any allowable amounts cannot be deducted, they may potentially be surrendered as group relief for the same accounting period under CTA10/PART5 – F(2)A17/S22 (3) and (4), but not as group relief for carried-forward losses.

Ordering of reliefs

Relief under CTA10/PART6A is given after all other deductions, except for relief under CTA10/PART6 (charitable donations), group relief under CTA10/PART5, and group relief for carried-forward losses under CTA10 /PART5A – CTA10/S217A (2).

Amounts eligible for relief

In the case of payments made directly by companies to grassroots sports (rather than by or via qualifying sport bodies), the total of these direct payments is eligible for relief up to and equal to the annual maximum deductible amount of £2,500 (as set in FA(2)17). If in these cases the company makes an annual payment directly to grassroots sports that exceeds £2,500, a deduction is allowed only for the part of the total expenditure that does not exceed £2,500.

The Treasury may make regulations to amend the annual amount of £2,500 – CTA10/S217A (10).

Accounting periods

Where an accounting period of a company is less than 12 months, the annual amount of £2,500 is reduced proportionately on a time basis – CTA10/S217A (9).

Where an accounting period of a company begins before 1 April 2017 and ends on or after that date the amount of £2,500 is apportioned on a time basis to the part of the accounting period that falls in the period beginning 1 April 2017 (F(2)A17/S22 (7)).