Income and Corporation Taxes Act 1988 (c. 1)

SCHEDULES

SCHEDULE A1 U.K. Determination of profits attributable to permanent establishment: supplementary provisions

Part 3 U.K. Provisions applicable to non-resident banks

Borrowing by non-resident banks: permanent establishment acting as agent or intermediary U.K.

10 (1) This paragraph applies where a permanent establishment—

(a) borrows funds for the purposes of another part of the non-resident company, and

(b) in relation to that borrowing acts only as an agent or intermediary.

(2) In such a case, in accordance with the separate enterprise principle—

(a) the profits attributable to the permanent establishment, and

(b) the capital attributable to the permanent establishment under section 11AA(3),

shall be that appropriate in the case of an agent acting at arm’s length, taking into account the risks and costs borne by the establishment.