C1C3C2F1Part 10F1Corporate interest restriction
Pt. 10 excluded by 2010 c. 4, s. 937NA (as inserted (with effect in accordance with Sch. 5 para. 25(1)(2) of the amending Act) by Finance (No. 2) Act 2017 (c. 32), Sch. 5 para. 7)
Pt. 10 excluded by 2010 c. 4, s. 938V(d) (as substituted (with effect in accordance with Sch. 5 para. 25(1)(2) of the amending Act) by Finance (No. 2) Act 2017 (c. 32), Sch. 5 para. 9)
Pt. 10 excluded by 2010 c. 4, s. 938N(e) (as substituted (with effect in accordance with Sch. 5 para. 25(1)(2) of the amending Act) by Finance (No. 2) Act 2017 (c. 32), Sch. 5 para. 8)
F1CHAPTER 3F1Tax-interest amounts
F1Tax-interest expense and income amounts: basic rules
382F1The tax-interest expense amounts of a company
1
References in this Part to a “tax-interest expense amount” of a company for a period of account of a worldwide group are to any amount that—
a
is (or apart from this Part would be) brought into account for the purposes of corporation tax in a relevant accounting period of the company, and
b
meets condition A, B or C.
F21A
But, in the case of a company which is a charity (as defined in paragraph 1 of Schedule 6 to FA 2010) at the end of the period of account, references in this Part to a “tax-interest expense amount” of the company do not include references to an amount which meets Condition A, B or C.
2
Condition A is that the amount is a relevant loan relationship debit (see section 383).
3
Condition B is that the amount is a relevant derivative contract debit (see section 384).
4
Condition C is that the amount is in respect of the financing cost implicit in amounts payable under a relevant arrangement or transaction.
5
In subsection (4) “relevant arrangement or transaction” means—
a
a finance lease,
b
debt factoring, or any similar transaction, or
c
a service concession arrangement if and to the extent that the arrangement is accounted for as a financial liability.
6
Subsection (8) applies if an accounting period in which a tax-interest expense amount is (or apart from this Part would be) brought into account for the purposes of corporation tax contains one or more disregarded periods.
7
A “disregarded period” is any period falling within the accounting period—
a
which does not fall within the period of account of the worldwide group, or
b
throughout which the company is not a member of the group.
8
Where this subsection applies, the tax-interest expense amount mentioned in subsection (6) is reduced by such amount as is referable, on a just and reasonable basis, to the disregarded period or periods mentioned in that subsection.
9
An amount may be reduced to nil under subsection (8).
10
If—
a
an amount would have met condition A, B or C but for the application of a rule preventing its deduction,
b
some or all of it is deductible at a subsequent time as a result of the application of another rule, and
c
none of conditions A to C are met at that time,
so much of the amount as is subsequently deductible is treated, at that time, as meeting whichever of condition A, B or C would have been met but for the application of the rule mentioned in paragraph (a).
11
An example of a case to which subsection (10) applies is a case where—
a
an amount is prevented from being deducted as a result of any provision made by Part 6A (hybrid and other mismatches), and
b
another provision of that Part subsequently applies so as to permit some or all of it to be deducted from total profits.
Pt. 10: the existing Pt. 10 renumbered as Pt. 11 (except for ss. 375, 376 which are repealed), the existing ss. 372-374, 377-382 renumbered as ss. 499-507 and a new Pt. 10 (ss. 372-498) inserted (with effect in accordance with Sch. 5 para. 25(1)-(3) of the amending Act) by Finance (No. 2) Act 2017 (c. 32), Sch. 5 para. 1, 10(1)(2)(a)(3) (with Sch. 5 paras. 27, 32-34)