Corporation Tax Act 2010 section 8

UK resident company preparing accounts in currency other than sterling

Section 8 deals with how a UK resident company that prepares its accounts in a non-sterling currency must calculate its profits or losses in sterling for corporation tax purposes, where neither section 6 nor section 7 applies.

• This rule applies when a UK resident company prepares accounts in a currency other than sterling (the "accounts currency") and neither the section 6 nor section 7 special rules apply — for example, where the company's functional currency is the same as its accounts currency.
• Profits or losses must be calculated using a two-step process: first, compute them in the accounts currency, then convert the result into sterling using the method set out in section 11.
• Any sterling amounts referred to in the Corporation Tax Acts are treated as if they were expressed in the company's accounts currency.
• This ensures that all corporation tax calculations ultimately produce a sterling figure, even where the company's day-to-day accounting is conducted in another currency.