CT600 Box 415: Franked Investment Income Explained

When completing your company tax return, you may encounter Box 415 on the CT600. This box is reserved for franked investment income (FII) — a specific category of income that is excluded from your corporation tax calculation. For most small companies, Box 415 will be left blank. But if your company receives dividends from other UK-resident companies, this box matters.

What Is Franked Investment Income?

Franked investment income refers to dividends and other distributions received from UK-resident companies. The term "franked" comes from the idea that these distributions have already been subject to corporation tax at source — the paying company has already paid tax on its profits before distributing them.

Under UK corporation tax rules, dividends paid by one UK company to another are generally exempt from corporation tax in the receiving company. This prevents the same profits from being taxed twice — once in the paying company and again in the receiving company.

When your company receives dividends from a UK company in which it holds shares, those dividends are treated as franked investment income. They must be reported in Box 415 so that HMRC can verify your total profit figure and confirm that these amounts are correctly excluded from your taxable profits.

What Is Box 415 Used For?

Box 415 sits within the tax calculation section of the CT600. It appears alongside your trading profits (Box 400), ring fence profits (Box 405), and total profits (Box 410).

The purpose of Box 415 is twofold:

1. Transparency — It shows HMRC the full picture of your company's income, including amounts that are exempt from tax
2. Verification — It allows HMRC to cross-reference the exempt distribution against the paying company's records

Importantly, the amount in Box 415 does not reduce your corporation tax liability in a straightforward way — it is disclosed as part of the overall return. FII is already excluded from your profits when calculating taxable income. It should not appear in Box 235 (your adjusted trading profit), as including it there would be double-counting.

When Does Box 415 Apply?

Box 415 applies if your company receives dividends from another UK company where:

• The dividend is from a UK-resident company (overseas dividends are subject to different rules)
• The distribution falls within the definition of a qualifying exempt distribution under the Corporation Tax Act 2009
• Your company holds shares in the paying company as an investment (not as stock-in-trade for a share-dealing business)

Most small companies — sole directors running a single limited company with no share investments — will never need to complete Box 415. It is relevant mainly to companies that:

• Hold shares as investments in other UK businesses
• Receive dividend income from minority shareholdings
• Are part of a wider corporate group

If you are a director taking dividends from your own company, those are not franked investment income — they are a distribution of profits to a shareholder, and they do not appear on the company's CT600 at all.

A Practical Example

Suppose your company, Oakfield Trading Ltd, holds 15% of the shares in another UK company, Riverside Supplies Ltd. During the accounting period, Oakfield receives a dividend of £10,000 from Riverside Supplies.

Because Riverside Supplies is a UK-resident company and has already paid corporation tax on its profits, this £10,000 dividend is treated as franked investment income. Oakfield should:

1. Exclude the £10,000 from its trading profit calculation — it should not appear in Box 235
2. Report the £10,000 in Box 415 of the CT600
3. Expect no additional corporation tax to arise from this income

This is one reason why dividend income received at corporate level is often described as tax-efficient — it does not create a further corporation tax liability.

Box 415 in the Context of Box 410 (Total Profits)

Box 415 appears in the same part of the CT600 as CT600 Box 410 (Total Profits). Your total profits figure represents all chargeable income before FII is set aside. Understanding how total profits are constructed helps you see where Box 415 sits in the overall calculation.

For most small companies, the relevant boxes in this section work like this:

Box	Description	Typical value
Box 400	Trading profits	Core business profit
Box 405	Ring fence profits	Usually zero
Box 410	Total profits	Sum of above
Box 415	Franked investment income	Disclosed, not taxed

FII disclosed in Box 415 is separate from the profit figures that feed into your corporation tax calculation.

FII and the Exemption From Double Taxation

The policy behind exempting FII from corporation tax reflects a fundamental principle of UK tax law: profits should not be taxed twice at the corporate level.

When a company earns £100 in trading profit, pays 25% corporation tax and distributes the remaining £75 as a dividend, the receiving company should not pay another round of corporation tax on that £75. Box 415 is the mechanism by which the receiving company shows HMRC that it has received — and correctly excluded — this income.

This exemption applies to most dividends from UK companies. There are exceptions, including dividends paid on certain preference shares or arrangements designed to exploit the exemption. If your situation is unusual, seek advice from an accountant.

How TinyTax Handles Box 415

If you are filing through TinyTax, you do not need to manually enter a figure in Box 415. The platform automatically handles the treatment of UK dividend income:

• Dividend income entered in your profit and loss is excluded from the adjusted trading profit (Box 235)
• The amount is reported in the correct section of the CT600 where applicable
• Box 415 is populated automatically

You simply need to ensure that dividend income from UK companies is correctly recorded in your accounts. TinyTax handles the classification.

Common Questions About Box 415

What if my company receives both trading income and dividend income? The two types of income are kept separate. Trading income flows through to Box 235 and onward to your taxable profits. Dividend income from UK companies is reported in Box 415 and excluded from the taxable calculation.

Does Box 415 affect my marginal relief? Franked investment income is generally excluded from the profits used to assess whether marginal relief applies. Your taxable profits for marginal relief purposes are based on your trading and other chargeable income, not FII. For a full explanation of how marginal relief is calculated and when it applies, see our Marginal Relief for Corporation Tax guide.

What if I receive dividends from an overseas company? Overseas dividends are subject to different rules and do not qualify as franked investment income in the same way. They may still be exempt, but the rules are more complex. Seek specific advice if your company receives overseas dividend income.

Does this apply to interest income as well? No. Interest received is not FII — it is loan relationship income and is generally chargeable to corporation tax as non-trading income. Only dividends and qualifying distributions from UK-resident companies count as franked investment income.

Summary

CT600 Box 415 is where you report franked investment income — dividends received from other UK-resident companies that are exempt from corporation tax. The purpose is disclosure, not additional taxation: the amount in Box 415 confirms to HMRC that this income has been correctly treated as exempt. For most small limited companies, Box 415 will be zero. If your company does hold shares and receives UK dividends, your filing software should handle Box 415 automatically. Ensure your accounts correctly classify dividend income as distinct from trading income to avoid errors in your return.