Corporation Tax Act 2010 section 679

Restriction on debits to be brought into account

Section 679 restricts the loan relationship debits a company can claim after a change in ownership, by capping the cumulative relevant non-trading debits at the level of the company's taxable total profits in the accounting period ending with the change.

• After a change in ownership, relevant non-trading debits on the company's loan relationships are restricted for the first post-change accounting period and all subsequent periods
• The restriction applies where Amount A (cumulative relevant non-trading debits from the current and all earlier post-change periods) exceeds Amount B (the taxable total profits of the accounting period ending with the change in ownership)
• Any relevant non-trading debits that cause Amount A to exceed Amount B are disallowed and cannot be brought into account
• The definition of "relevant non-trading debit" is provided in section 730 of the Corporation Tax Act 2010