Taxation (International and Other Provisions) Act 2010 section 24

Accounting period's pro-rata share of the total disallowed amount

Section 24 sets out how the total disallowed amount of a worldwide group's interest restrictions is allocated on a pro-rata basis to the relevant accounting periods of UK group companies.

• When a worldwide group is subject to interest restrictions in a period of account, the total disallowed amount must be allocated across the relevant accounting periods of UK group companies during that period.
• If a company has only one relevant accounting period and its pro-rata share is not nil, the entire share is allocated to that single period.
• If a company has more than one relevant accounting period, the share is split between those periods in proportion to the net tax-interest expense arising in each period (using the formula A × B / C).
• Where no amount is allocated to a particular accounting period under these rules, the pro-rata share for that period is treated as nil.