Can someone just quickly try to explain something to me.
From the technical articles for F6, it says:
"Marginal relief eases the transition from the small profits rate to the main rate of
corporation tax where augmented profits fall between £300,000 and £1,500,000."
So, from that, it reads like, any company with augmented profits that fall between £300,000 and £1,500,000 is able to claim marginal relief (using the 1/100 x (U-A) x N/A formula) - so far so good. Augmented profits that are either below £300,000 or over £150,000 don't qualify for marginal relief.
Why then, in question 2 from the June 2013 paper can the company in question claim marginal relief when its augmented profits are only £252,000 (total profits of £213,000 plus franked investment of £39,000).
Total augmented profits is £252,000 which is below the £300,000 threshold - yet the answers say that marginal relief is to be claimed.
It's been a long day, so probably something very simple - someone please help?
ACCA Forums
TXMarginal Relief and augmented profits
Has 3 associate companies so the upper and lower limits are divided by 4
ah ok, so upper limit becomes £375,000 and the lower limit is now £75,000 - thus the augmented profit of £252,000 sits within this new range.
Thanks.
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