Taxation (International and Other Provisions) Act 2010 section 386

Relevant loan relationship credits

Section 386 defines what counts as a "relevant loan relationship credit" for the purpose of calculating a company's tax-interest income amounts under the corporate interest restriction rules.

• A relevant loan relationship credit is a credit brought into account for corporation tax purposes in respect of a loan relationship, whether from a trading or non-trading loan relationship.
• The credit must be one that is, or would be (if the corporate interest restriction rules did not apply), recognised under Part 3 of CTA 2009 (trading loan relationships) or Part 5 of CTA 2009 (non-trading loan relationships).
• Credits arising from foreign exchange gains are excluded from the definition and do not count as relevant loan relationship credits.
• Credits arising from the reversal of an impairment loss (for example, where a previously written-down debt recovers in value) are also excluded.