Corporation Tax Act 2009 section 575

Overview of Chapter

Section 575 provides a roadmap to Chapter 2, which determines which contracts fall within the derivative contracts tax regime in Part 7 of the Act.

• The chapter defines key terms including "derivative contract", "relevant contract", "option", "future" and "contract for differences", which together establish whether a particular contract qualifies as a derivative contract for corporation tax purposes.
• It sets out rules for situations where companies are treated as being parties to relevant contracts, even where they may not be direct counterparties — for example, where embedded derivatives are separated from hybrid instruments.
• Certain contracts and associated transactions that might not obviously be derivative contracts are brought within the regime and treated as if they were derivative contracts.
• Conversely, certain contracts are excluded from the derivative contracts regime based on the nature of their underlying subject matter, ensuring that only appropriate financial instruments are taxed under these rules.