Part 2Trading income
Chapter 13Deductions from profits: unremittable amounts
188Application of Chapter
1
This Chapter applies if—
a
an amount received by, or owed to, a person carrying on a trade (“the trader”) is brought into account as a receipt in calculating the profits of the trade,
b
the amount is paid or owed in a territory outside the United Kingdom, and
c
some or all of the amount is unremittable.
2
An amount received is unremittable if it cannot be transferred to the United Kingdom merely because of foreign exchange restrictions.
3
An amount owed is unremittable if it cannot be paid in the United Kingdom and—
a
it temporarily cannot be paid in the territory in which it is owed merely because of foreign exchange restrictions, or
b
it can be paid in that territory but, if it were paid there, the amount paid would not be transferable to the United Kingdom merely because of foreign exchange restrictions.
4
“Foreign exchange restrictions” are restrictions imposed by any of the following—
a
the laws of the territory where the amount is paid or owed,
b
executive action of its government, and
c
the impossibility of obtaining there currency that could be transferred to the United Kingdom.