Corporation Tax Act 2009 section 93

Plain vanilla contracts which became derivative contracts before 30 December 2006

Section 93 deals with the chargeable gains treatment when a company disposes of a plain vanilla contract that became a derivative contract before 30 December 2006, where certain other transitional provisions do not apply.

• Applies to plain vanilla contracts that became derivative contracts before 30 December 2006, where the company disposes of the contract and paragraphs 91 and 92 do not apply
• The normal rule giving the derivative contracts regime priority over chargeable gains rules is switched off for the purpose of calculating any chargeable gain on disposal
• Allowable acquisition costs for chargeable gains purposes are adjusted upwards if cumulative non-trading credits exceed debits, or downwards if cumulative non-trading debits exceed credits
• If a downward adjustment exceeds the available acquisition cost deduction, the unrelieved excess is instead added to the disposal consideration