The Local Currency Elections Regulations 1994

Elections for part trades

4.—(1) Subject to the following provisions of these Regulations, a company carrying on a trade may by notice given to the inspector elect to have the basic profits and losses of a specified part of the trade computed and expressed for the purposes of corporation tax in a specified local currency.

(2) A company may make an election under this regulation—

(a) for a trade which it carries on, wholly or in part, through one or more overseas branches, or

(b) for a ring fence trade as respects which the condition mentioned in section 94A(2) of the 1993 Act(1) is fulfilled,

but not in relation to any other trade (and accordingly an election under paragraph (1) of this regulation may, subject to these Regulations, be made for a part of the trade which is carried on in the United Kingdom).

(3) An election under this regulation may specify different currencies for different parts of the trade but if the company makes an election for each part of the trade, at least two currencies must be specified.

(4) Where a company makes more than one election for different parts of one trade, paragraph (3) above shall apply cumulatively to the elections.

(5) Where a company carries on part of a trade through two or more branches situated in the same country, an election under paragraph (2)(a) above for that part of the trade must specify the same currency to be used for all those branches, and for the purposes of this paragraph the United Kingdom shall be taken to be one country.

(6) In any case where a company makes an election under this regulation for one or more parts of a trade but not for all the parts of the trade, the basic profits and losses of any part of the trade for which there is no election shall be computed and expressed for the purposes of corporation tax in sterling.

(7) A company may not make an election under this regulation for part of a trade for an accounting period if there is in force an election under regulation 3 for that trade and that accounting period.

(1)

Section 94A was inserted by section 136(1) of the Finance Act 1994 (c. 9).