C1C2Part 2Double taxation relief
Pt. 2 applied by 2010 c. 4, s. 269DL(6) (as inserted (with effect in accordance with Sch. 3 Pt. 3 of the amending Act) by Finance (No. 2) Act 2015 (c. 33), Sch. 3 para. 1)
C2CHAPTER 2Double taxation relief by way of credit
Limits on credit: general rules
35Disallowed credit: use as a deduction
1
Subsection (2) applies if the application of section 36(2) or 42(2) prevents an amount of credit for foreign tax from being allowable against income tax or corporation tax.
2
The taxpayer's income is to be treated as reduced by the amount of the disallowed credit.
3
Subsection (4) applies if the application of section 40(2) prevents an amount of credit for foreign tax from being allowable against capital gains tax.
4
The taxpayer's chargeable gains are to be treated as reduced by the amount of the disallowed credit.
5
Subsection (2) or (4) applies only so far as the amount of disallowed credit does not exceed the amount of any loss attributable to the income or gain in respect of which the foreign tax was paid.
6
For the purposes of subsection (5), payment of the foreign tax is to be taken into account despite section 31(2).
Pt. 2 modified by 1988 c. 1, Sch. 19ABA paras. 26-28 (as inserted (with effect in accordance with s. 381(1) of the amending Act) by Taxation (International and Other Provisions) Act 2010 (c. 8), s. 381(1), Sch. 8 para. 34(3) (with Sch. 9 paras. 1-9, 22))