Corporation Tax Act 2010 section 705G

Meaning of certain expressions in section 705F

Section 705G defines the meaning of key terms used in the apportionment table in section 705F, specifically relating to adjusted non-trading profits and deficits from loan relationships, and sets out two conditions that determine how certain amounts are treated.

• Adjusted non-trading profits from loan relationships are calculated by excluding amounts relating to rows 3 and 4 of the section 705F table, and would otherwise be taxable under section 299 of CTA 2009.
• Adjusted non-trading deficits from loan relationships are similarly calculated by excluding amounts relating to rows 3 and 4 of the section 705F table.
• Condition A applies where a loan relationship amount is determined on an amortised cost basis and none of the special provisions regarding late interest or deeply discounted securities for connected or close companies apply.
• Condition B applies where a loan relationship amount is determined on an amortised cost basis but one or more of those special provisions regarding late interest or deeply discounted securities do apply.