Embedded derivatives in connected party loans48A

Where in any accounting period—

a

a company is party as a creditor to a loan relationship falling within section 94A(1) of the Finance Act 1996, and

b

the loan relationship is one to which section 87 of that Act applies (accounting methods where parties have a connection),

no loss arising in that period to the company from the derivative contract, or any of the derivative contracts, to which in the case of that loan relationship the company is treated as party by virtue of section 94A(2)(b) of the Finance Act 1996 gives rise to a debit for the purposes of this Schedule.