Income Tax (Trading and Other Income) Act 2005 section 155

Levies and repayments under FISMA 2000

Section 155 deals with how certain levies and cost awards imposed under the Financial Services and Markets Act 2000 (FISMA) are treated when calculating trading profits for income tax purposes, and how any repayments of those levies are brought into account as taxable receipts.

• Traders who are authorised persons under FISMA 2000 may deduct levies paid under that Act (including Financial Services Compensation Scheme levies and ombudsman scheme payments) when calculating their trading profits, to the extent the amounts are not already deductible under general rules
• Costs paid as a result of awards under FISMA costs rules — whether made under section 230 of FISMA 2000 or under standard terms for the ombudsman scheme — are also deductible in the trading profit calculation
• Any repayments received by the trader under FISMA repayment provisions (for example, refunds of Financial Services Compensation Scheme levies or ombudsman scheme fees) must be treated as taxable trading receipts
• The section defines "levy", "costs rules" and "repayment provision" by reference to specific FISMA 2000 provisions, covering payments to the Financial Conduct Authority, the Financial Services Compensation Scheme and the Financial Ombudsman Service