Corporation Tax Act 2009 section 1225

Accounts conforming with GAAP

Section 1225 sets out how management expenses recorded in GAAP-compliant accounts are allocated to the correct corporation tax accounting period.

• Where a company's period of account matches its accounting period, management expenses debited in GAAP-compliant accounts are simply allocated to that accounting period
• Where the period of account does not match the accounting period, management expenses must be apportioned across the accounting periods falling within that period of account
• The default method of apportionment is on a time basis, as set out in section 1172 of CTA 2010
• If a time-based apportionment would produce an unreasonable or unjust result, the expenses should instead be apportioned on a just and reasonable basis