Corporation Tax Act 2010 section 222

Determination of "the invested amount"

Section 222 sets out how to calculate "the invested amount" for loans, securities or shares that form part of a community investment, which is needed to work out the tax relief available under the Community Investment Tax Relief (CITR) scheme.

• For loans, the invested amount is based on the average capital balance of the loan over specific periods aligned to each year of a 5 year period, with a cap from the third year onwards based on the average balance during months 18 to 24 after the investment date
• For securities or shares, the invested amount is simply the amount the investor originally subscribed for them
• The average capital balance of a loan for any period is calculated as the mean of the daily balances of capital outstanding during that period
• The invested amount may be adjusted downwards under separate provisions where the investor receives value back from the community development finance institution