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FA19/Sch 5/Para 48

From 6 April 2020, non-resident companies receiving UK property income will be chargeable to Corporation Tax instead of Income Tax on this income.

Where a non-resident company is chargeable to Income Tax on its property income immediately before 6 April 2020 and becomes chargeable to Corporation Tax on 6 April 2020, an accounting period for Corporation Tax purposes will commence on 6 April 2020. The instalment payment regulations will not have effect in relation to that first accounting period in which the company becomes chargeable to Corporation Tax . This means that no instalment payments will be needed, regardless of whether the company is 'large' or 'very large' for instalment payment purposes.

Example

A non-resident company receiving UK property income and with an accounting period ended 30 September 2020 will have a first accounting period of 6 April 2020 to 30 September 2020. This period is ignored for instalment payment purposes.

In the next accounting period to 30 September 2021, it has profits of £1,600,000. It does not have to make instalment payments for this period even though it is 'large' for instalment payment purposes as Reg 3 provides an exemption for the first period in which the company is 'large.'  

The instalment payment regime will apply as normal to the next and all subsequent accounting periods.