Taxation (International and Other Provisions) Act 2010

[F1 411 “Relevant expense amount” and “relevant income amount” U.K.

(1) In this Chapter “relevant expense amount” means (subject to subsection (3)) an amount in respect of any of the following—

(a) interest payable under a loan relationship;

(b) expenses ancillary to a loan relationship [F2 or related transaction];

(c) losses arising from a loan relationship or a related transaction, other than—

(i) exchange losses, and

(ii) impairment losses;

(d) dividends payable in respect of preference shares accounted for as a financial liability;

(e) losses arising from a relevant derivative contract or a related transaction, other than—

(i) exchanges losses,

(ii) impairment losses, and

[F3 (iii) losses in respect of risks arising in the ordinary course of a trade (other than risks arising in the ordinary course of a financial trade) where the derivative contract was entered into wholly for reasons unrelated to the capital structure of the worldwide group (or any member of the worldwide group);]

(f) expenses ancillary to a relevant derivative contract or related transaction;

(g) financing charges implicit in payments made under a finance lease;

(h) financing charges relating to debt factoring [F4 or any similar transaction];

(i) financing charges implicit in payments made under a service concession arrangement if and to the extent that the arrangement is accounted for as a financial liability;

[F5 (j) debits that are brought into account under Part 5 of CTA 2009 as a result of section 481 of that Act (relevant non-lending relationships), or would be so brought into account if the company in question were within the charge to corporation tax, other than—

(i) exchange losses, or

(ii) impairment losses;]

(k) alternative finance return payable under alternative finance arrangements;

(l) manufactured interest payable;

(m) financing charges in respect of the advance under a debtor repo or debtor quasi-repo;

(n) financing charges so far as they are made up of amounts which—

(i) are treated as interest payable under a loan relationship under a relevant provision of Chapter 2 of Part 16 of CTA 2010 (finance arrangements), or

(ii) would be so treated if the company in question were within the charge to corporation tax.

(2) In this Chapter “relevant income amount” means (subject to subsection (3)) an amount in respect of any of the following—

(a) interest receivable under a loan relationship;

(b) profits arising from a loan relationship or a related transaction, other than—

(i) exchange gains, and

(ii) the reversal of impairment losses;

(c) dividends receivable in respect of preference shares accounted for as a financial asset;

(d) gains arising from a relevant derivative contract or a related transaction, other than—

(i) exchange gains,

(ii) the reversal of impairment losses, and

[F6 (iii) gains in respect of risks arising in the ordinary course of a trade (other than risks arising in the ordinary course of a financial trade) where the derivative contract was entered into wholly for reasons unrelated to the capital structure of the worldwide group (or any member of the worldwide group);]

(e) financing income implicit in amounts received under a finance lease;

(f) financing income relating to debt factoring [F7 or any similar transaction];

(g) financing income implicit in amounts received under a service concession arrangement if and to the extent that the arrangement is accounted for as a financial asset;

[F8 (h) credits that are brought into account under Part 5 of CTA 2009 as a result of section 481 of that Act (relevant non-lending relationships), or would be so brought into account if the company in question were within the charge to corporation tax, other than—

(i) exchange gains, or

(ii) the reversal of impairment losses;]

(i) alternative finance return receivable under alternative finance arrangements;

(j) manufactured interest receivable;

(k) financing income in respect of the advance under a creditor repo or creditor quasi-repo;

(l) financing income so far as it is made up of amounts which—

(i) are treated as interest receivable under a loan relationship under a relevant provision of Chapter 2 of Part 16 of CTA 2010 (finance arrangements), or

(ii) would be so treated if the company in question were within the charge to corporation tax.

(3) In this Chapter—

(a) “relevant expense amount” does not include an amount payable under a pension scheme;

(b) “relevant income amount” does not include an amount receivable under a pension scheme.

F9 (4) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .]

Textual Amendments

F1 Pt. 10: the existing Pt. 10 renumbered as Pt. 11 (except for ss. 375, 376 which are repealed), the existing ss. 372-374, 377-382 renumbered as ss. 499-507 and a new Pt. 10 (ss. 372-498) inserted (with effect in accordance with Sch. 5 para. 25(1)-(3) of the amending Act) by Finance (No. 2) Act 2017 (c. 32), Sch. 5 para. 1, 10(1)(2)(a)(3) (with Sch. 5 paras. 27, 32-34)

F2 Words in s. 411(1)(b) inserted (retrospectively) by Finance Act 2018 (c. 3), Sch. 8 paras. 20(2)(a), 23(1)

F3 S. 411(1)(e)(iii) substituted (with effect in accordance with Sch. 8 para. 22 of the amending Act) by Finance Act 2018 (c. 3), Sch. 8 para. 4(2)

F4 Words in s. 411(1)(h) inserted (retrospectively) by Finance Act 2018 (c. 3), Sch. 8 paras. 20(2)(b), 23(1)

F5 S. 411(1)(j) substituted (with effect in accordance with Sch. 3 para. 30-36 of the amending Act) by Finance (No. 2) Act 2023 (c. 30), Sch. 3 para. 6(2)

F6 S. 411(2)(d)(iii) substituted (with effect in accordance with Sch. 8 para. 22 of the amending Act) by Finance Act 2018 (c. 3), Sch. 8 para. 4(3)

F7 Words in s. 411(2)(f) inserted (retrospectively) by Finance Act 2018 (c. 3), Sch. 8 paras. 20(3), 23(1)

F8 S. 411(2)(h) substituted (with effect in accordance with Sch. 3 para. 30-36 of the amending Act) by Finance (No. 2) Act 2023 (c. 30), Sch. 3 para. 6(3)

F9 S. 411(4) omitted (retrospectively) by virtue of Finance Act 2019 (c. 1), Sch. 11 paras. 19, 24