Corporation Tax Act 2010 section 9A

Designated currency of a UK resident investment company

Section 9A allows a UK resident investment company to elect a designated currency for corporation tax purposes, provided certain conditions about the company's assets, liabilities or group structure are met.

• A UK resident investment company can elect a currency as its "designated currency" for tax purposes, but the election only takes effect if the company meets one of two qualifying conditions at the relevant time.
• Condition A requires that a significant proportion of the company's assets and liabilities are denominated in the elected currency; Condition B requires that the currency is the functional currency of another company in the same consolidated group.
• For any accounting period in which the election is in force, the company must calculate its profits or losses as though the designated currency were its functional currency, with no part of its business treated as having a different functional currency.
• The consolidation condition is satisfied where the company's financial results are included, or would be included, in consolidated group financial statements prepared under acceptable accounting practice, which includes international accounting standards, UK GAAP, or the generally accepted practice in the parent company's country of residence.