Corporate interest restriction ― carry-forward amounts

By Tolley
Corporation_tax_img6

The following Corporation Tax guidance note by Tolley provides comprehensive and up to date tax information covering:

  • Corporate interest restriction ― carry-forward amounts
  • What can be carried forward under the CIR rules?
  • Tax-interest expense disallowance carried forward
  • Unused interest allowance
  • Excess debt cap

What can be carried forward under the CIR rules?

Companies may experience variations in business profits and market interest rates. Changes in capital structure that impact the level of debt on the balance sheet may also occur from time to time. These and other sources of volatility could result in interest disallowances in some periods and unused interest allowances in other periods.

To provide a greater element of fairness in the corporate interest restriction (CIR) rules, there are a number of carry-forward provisions:

Tax attributeOwnershipCarry-forward periodStatutory reference
Tax-interest disallowedCompanyIndefinite carry forwardTIOPA 2010, s 378
Unused interest allowanceWorldwide groupFive yearsTIOPA 2010, ss 392395A

More on Corporate interest restriction: