Taxation (International and Other Provisions) Act 2010 section 50

Tax for period on loan relationships

Section 50 adjusts the way corporation tax is calculated for double taxation credit relief purposes when a company has non-trading loan relationship income that qualifies for relief from foreign tax.

• This section applies when a company has at least one non-trading credit from a loan relationship that is eligible for double taxation relief in a given period.
• For credit relief limit calculations, corporation tax is treated as being charged on the total gross non-trading credits, rather than on the net non-trading profit from loan relationships.
• A non-trading credit is eligible for double taxation relief if foreign tax has been paid on the underlying item and credit for that foreign tax is allowable under a double taxation arrangement.
• Non-trading credits and the total non-trading credits figure (TNTC) are defined by reference to Part 5 of the Corporation Tax Act 2009, which governs the loan relationships regime.