Corporation Tax Act 2009 section 306A

Matters in respect of which amounts to be brought into account

Section 306A identifies the categories of amounts that a company must bring into account for corporation tax purposes in relation to its loan relationships and related transactions.

• Companies must bring into account profits, losses, interest and expenses arising from their loan relationships and related transactions.
• Profits and losses (excluding interest and expenses), interest, and expenses are treated as three separate categories of amounts.
• Expenses qualify only if they are directly incurred in creating the loan relationship, entering into related transactions, making payments, or securing the receipt of payments.
• Separate rules in section 329 deal with expenses incurred before a loan relationship comes into existence and with costs of abortive transactions.