Corporation Tax Act 2009

400 [F1 Adjustments for changes in index] U.K.

(1) This section applies if—

(a) [F2 an amount] to be brought into account for the purposes of this Part in respect of [F3 an index-linked gilt-edged security] [F4 falls] to be determined by reference to its value at two different times, and

(b) there is a change in the retail prices index between the earlier and the later time.

(2) If that change is an increase, the carrying value of the security at the earlier time is increased by the same percentage as the percentage increase in the retail prices index between those times.

[F5 (2A) Subsection (2) is subject to sections 400A to 400C (relevant hedging schemes).]

(3) If that change is a reduction, the carrying value of the security at the earlier time is reduced by the same percentage as the percentage reduction in the retail prices index between those times.

(4) The Treasury may, in relation to any description of index-linked gilt-edged securities, by order provide that—

(a) there are to be no adjustments under this section, or

(b) an adjustment specified in the order is to be made instead.

(5) An order under subsection (4)—

(a) may not apply to a security issued before the making of the order, but

(b) may make different provision for different descriptions of securities.

(6) The general rule is that the percentage increase or reduction in the retail prices index is determined for the purposes of this section by reference to the difference between—

(a) the index for the month in which the earlier time falls, and

(b) the index for the month in which the later time falls.

(7) But if the earlier time falls at the beginning of an accounting period which begins with the first day of a month, the index for the previous month is used for the purposes of subsection (6)(a).

Textual Amendments

F1 S. 400 heading substituted (with effect in accordance with Sch. 14 para. 8 of the amending Act) by Finance Act 2010 (c. 13), Sch. 14 para. 5(2) (with Sch. 14 para. 9)

F2 Words in s. 400(1)(a) substituted (with effect in accordance with Sch. 14 para. 8 of the amending Act) by Finance Act 2010 (c. 13), Sch. 14 para. 5(3)(a) (with Sch. 14 para. 9)

F3 Words in s. 400(1)(a) substituted (retrospective and with effect in accordance with art. 1(2) of the commencing S.I.) by Corporation Tax Act 2009 (Amendment) Order 2010 (S.I. 2010/614), arts. 1(1), 3(2)

F4 Word in s. 400(1)(a) substituted (with effect in accordance with Sch. 14 para. 8 of the amending Act) by Finance Act 2010 (c. 13), Sch. 14 para. 5(3)(b) (with Sch. 14 para. 9)

F5 S. 400(2A) inserted (with effect in accordance with Sch. 14 para. 8 of the amending Act) by Finance Act 2010 (c. 13), Sch. 14 para. 5(4) (with Sch. 14 para. 9)