Commentary

D7.5110 Apportionment of increases and decreases in value in non-profit funds for accounting periods beginning before 1 January 2007

Corporate tax
Corporate tax | Commentary

D7.5110 Apportionment of increases and decreases in value in non-profit funds for accounting periods beginning before 1 January 2007

Corporate tax | Commentary

D7.5110 Apportionment of increases and decreases in value in non-profit funds for accounting periods beginning before 1 January 2007

The rules in this division apply for accounting periods beginning before 1 January 2013. For accounting periods beginning on or after 1 January 2013 see Division D7.4.

As with income, the starting point for the apportionment of increases and decreases in the value of non-profit funds is to treat any such increases or decreases in the value of linked assets as referable to the category of business to which they are linked1.

Any increases or decreases in the value of assets brought into account which are not referable directly to any category of business must be allocated among the different categories of business according to the relevant fraction2. The apportionment closely follows the structure of ICTA 1988, s 432C3 except that overseas life assurance business is included with the other categories for the purposes of allocating changes in the value of linked assets4 and determining the balance of the movements in values of non-linked assets that are to be allocated among the categories of business5. The numerator of the relevant fraction is the average of the opening and closing liabilities of the category of business concerned, reduced (but not below nil) by the average of the opening and closing values of any assets which are directly referable to that category of business. If the mean of the liabilities would be less than nil, it is instead taken as nil. Once again, the

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