INTM489560 - Diverted Profits Tax: introduction and overview: the Diverted Profits Tax charge

DPT applies to diverted profits arising on or after 1 April 2015. There are apportionment rules for accounting periods that straddle that date.

The normal rate of DPT is 25% of the diverted profit plus any “true-up interest”.

Where taxable diverted profits are ring-fence profits or notional ring-fence profits in the oil sector, DPT is charged at a rate of 55% plus true-up interest.

Finance (No.2) Act 2015 introduced a surcharge of 8% on the taxable profits of banking companies arising on or after 1 January 2016. There are consequential amendments to the DPT legislation to apply DPT at a rate of 33% in cases where taxable diverted profits would have been subject to the surcharge.

Guidance about the computation of the tax, including the availability of credits and its interaction with other taxes, is in INTM489880.