Finance Act 2004

Transfer pricing and thin capitalisation: commencement U.K.

37 Commencement and transitional provisions U.K.

(1) In this section “the amending provisions” means—

(a) sections 30 to 32 (transfer pricing);

(b) sections 34 to 36 (thin capitalisation);

(c) Schedule 5 (provision not at arm’s length: related amendments).

(2) The amendments made by those provisions have effect in relation to chargeable periods beginning on or after 1st April 2004 (whenever the actual provision, within the meaning of Schedule 28AA to the Taxes Act 1988, is or was made or imposed).

(3) Where an accounting period of a company begins before, and ends on or after, 1st April 2004, it shall be assumed for the purposes of the amending provisions, the amendments which they make and subsection (2) that that accounting period (“the straddling period”) consists of two separate accounting periods—

(a) the first beginning with the straddling period and ending with 31st March 2004, and

(b) the second beginning with 1st April 2004 and ending with the straddling period,

and the company’s profits and losses shall be computed accordingly for tax purposes.

(4) Where a period of account of any person within the charge to income tax begins before, and ends on or after, 6th April 2004, it shall be assumed for the purposes of the amending provisions, the amendments which they make and subsection (2) that that period (“the straddling period of account”) consists of two separate periods of account—

(a) the first beginning with the straddling period of account and ending with 5th April 2004, and

(b) the second beginning with 6th April 2004 and ending with the straddling period of account,

and the person’s profits and losses shall be computed accordingly for the purposes of income tax.