*32.8 X Ltd is a UK resident company with nineteen subsidiaries, one of which is situated abroad. In the year to 31 March 2010, X Ltd had the following results:

£

UK trading profits 720,000 UK dividends received 40,000 UK chargeable gains 120,000 Dividend from overseas subsidiary received April 2009

(net of 30% withholding tax) 8,400 Charges paid (gross amount) 80,000 X Ltd owns 60% of the ordinary share capital of the overseas subsidiary (which is not a controlled foreign company). The summarised income statement of this subsidiary for the year to which the April 2009 dividend relates is as follows:

£

Profit before tax 75,000 Less: Provision for taxation liability 25,000

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Profits after tax 50,000 Dividends 20,000

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Retained profits c/f 30,000

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The subsidiary's actual tax liability for the year was £25,000.

(a) Calculate the corporation tax liability of X Ltd for the year to 31 March 2010.

(b) Calculate the maximum ACT set-off for the year.