Corporation Tax Act 2009 section 296

Profits and deficits to be calculated using credits and debits given by this Part

Section 296 establishes that a company must use the credits and debits framework set out in Part 5 of the Corporation Tax Act 2009 to calculate its profits and deficits from loan relationships.

• Profits and deficits from loan relationships must be calculated using the credits and debits specified in Part 5 of the Act.
• This is a mandatory requirement — companies have no discretion to use an alternative method.
• The credits and debits system replaces any other basis for computing loan relationship profits or losses for corporation tax purposes.
• This section provides the foundation for how all subsequent rules in Part 5 feed into the overall computation of a company's taxable profits or allowable deficits from its lending and borrowing activities.