Finance Act 2011

[F1 Determining the UK-based equity and liabilities of UK sub-groups U.K.

Textual Amendments

F1 Sch. 19 paras. 15-15Z5 and cross-headings substituted for Sch. 19 paras. 15-23 (with effect in accordance with Sch. 9 para. 35 of the amending Act) by Finance Act 2018 (c. 3), Sch. 9 para. 2

15J (1) This paragraph applies in relation to a UK sub-group if— U.K.

(a) each member of the UK sub-group is a UK resident entity,

(b) none of those members is a designated FPE entity, and

(c) the relevant group’s responsible member has not made an entity-by-entity election (see paragraph 15L) in relation to the UK sub-group.

(2) The assets, equity and liabilities, as at the end of the chargeable period, of the UK sub-group are to be determined by reference to the amounts recognised in the sub-group’s consolidated financial statements for the chargeable period.

(3) To determine the UK-based equity and liabilities of the UK sub-group, as at the end of the chargeable period—

(a) determine the amount of the UK sub-group’s equity and liabilities in accordance with sub-paragraph (2), and

(b) adjust that amount in accordance with paragraph 15N.

15K (1) This paragraph applies in relation to a UK sub-group if— U.K.

(a) at least one member of the UK sub-group is—

(i) a non-UK resident entity, or

(ii) a designated FPE entity, and

(b) the relevant group’s responsible member has not made an entity-by-entity election (see paragraph 15L) in relation to the UK sub-group.

(2) In this Schedule, “residual UK sub-group” means, in relation to a UK sub-group to which this paragraph applies, the group of entities consisting of the members of the UK sub-group which—

(a) are UK resident entities, but

(b) are not designated FPE entities.

(3) The assets, equity and liabilities of the residual UK sub-group are to be determined by reference to the amounts which, if financial statements had been prepared for the residual UK sub-group for the chargeable period under international accounting standards, would have been recognised in those statements.

(4) The amount of the UK-based equity and liabilities of the UK sub-group, as at the end of the chargeable period, is the total amount of—

(a) the equity and liabilities of the residual UK sub-group as at the end of that period, adjusted in accordance with paragraph 15N, and

(b) the adjusted equity and liabilities of each designated FPE entity which is a member of the UK sub-group (see Step 5 in paragraph 15Z1).

15L (1) If the relevant group’s responsible member makes an election under this paragraph (an “entity-by-entity election”) in relation to a UK sub-group, the UK-based equity and liabilities of the UK sub-group are to be determined in accordance with this paragraph. U.K.

(2) The amount of the UK-based equity and liabilities of the UK sub-group as at the end of the chargeable period is the total amount of—

(a) the adjusted equity and liabilities of each UK resident entity, other than a designated FPE entity, which is a member of the UK sub-group, and

(b) the adjusted equity and liabilities of each designated FPE entity which is a member of the UK sub-group (see Step 5 in paragraph 15Z1).

(3) To determine the “adjusted equity and liabilities” of a UK resident entity for the purposes of sub-paragraph (2)(a)—

(a) determine the amount of the entity’s equity and liabilities in accordance with paragraph 15G(2), and

(b) adjust that amount in accordance with paragraph 15N.

(4) An election made under this paragraph has effect in relation to the chargeable period during which the election is made and each subsequent chargeable period (unless it is revoked under sub-paragraph (6)(c)).

(5) But an election under this paragraph has no effect in relation to a UK sub-group for a chargeable period if the purpose, or one of the main purposes, of making the election is to avoid or reduce a charge or assessment to the bank levy.

(6) An election made under this paragraph in respect of the relevant group—

(a) must be made in the form and manner specified by the Commissioners for Her Majesty’s Revenue and Customs,

(b) must contain such information and declarations as the Commissioners may require, and

(c) may be revoked by the relevant group’s responsible member at any time.]