Corporation Tax Act 2009 section 314

Power to make regulations about changes from amortised cost basis

Section 314 gives the Treasury the power to make regulations requiring companies to continue using an amortised cost basis for calculating loan relationship credits and debits, even where accounting standards now require a switch to fair value accounting.

• Where accounting standards require a company to move from amortised cost to fair value accounting for its loan relationship assets or liabilities, the Treasury can intervene by regulation
• Regulations can require that credits and debits continue to be calculated on the old amortised cost basis, overriding the fair value requirement for tax purposes
• The regulations can set different rules for different circumstances and can include transitional provisions and savings
• The regulations can be made conditional on the company making an election or meeting other specified conditions