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Introduction to the relief

A payment made by a company which is qualifying expenditure on grassroots sport is allowed as a corporation tax deduction, subject to certain conditions. Without this specific legislation, a deduction would not otherwise be available on the basis that such a payment would not usually be made wholly and exclusively for the purposes of the trade.

The relief is given by way of a deduction from taxable total profits. It is given before group relief and group relief for carried-forward losses. It is not possible to create a loss by utilising this relief so spreadsheets used in tax calculations must be appropriately formulated to ensure total profits cannot be reduced below zero.

Where total profits have been reduced to nil, it is