The following Corporation Tax guidance note Produced by Tolley provides comprehensive and up to date tax information covering:
Since the introduction of FA 1996, interest payments for a limited company now fall under the loan relationship rules even if the company entered into the loan relationship for the purposes of its trade. There is, then, a distinction between trading and non-trading loan relationships. As the names suggest, generally speaking, a trading loan relationship will arise where a borrower has entered into the relationship to provide funding for its trade; otherwise, the relationship will be a non-trading loan relationship. The loan relationship rules are now found in CTA 2009, Part 5. For guidance on loan relationships, see the What is a loan relationship? guidance note.
For a property developer, finance will normally be required to some degree for a property acquisition and / or the development work itself. In this situation, the loan interest will be regarded as a trading loan relationship. CTA 2009, s 297(3) provides that trading loan relationship debits are treated as expenses of the trade and are therefore taken into account in computing the profits or losses of the trade for that period. CTA 2009, s 297(4) makes it clear that the loan relationship legislation overrides CTA 2009, s 54.
What constitutes interest can take a number of guises and it will be necessary to consider carefully any financial instrument entered into to dis
**Free trials are only available to individuals based in the UK. We may terminate this trial at any time or decide not to give a trial, for any reason.
Access this article and thousands of others like it free for 7 days with a trial of TolleyGuidance.
Read full article
Already a subscriber? Login
The substantial shareholding exemption (SSE) provides a complete exemption from the liability to corporation tax on the gains generated from qualifying disposals of shares and interests in shares by qualifying companies. Conversely, if losses are generated by the disposal and the SSE conditions are
Summary of capital allowances on carsThe current capital allowance rates applicable to cars are as follows:Pool typeDescription of carRateLegislationMain rate poolNew and unused cars with CO2 emissions over 50g/km but not more than 110g/km (to be reduced to 50g/km and below from April 2021)18%CAA
The corporate interest restriction (CIR) essentially limits the amount of interest expense a company can deduct from its taxable profits if the interest expense is over £2 million. The actual mechanics of the CIR calculation are highly complex (the legislation is over 150 pages long) and are
Preparatory workBefore completing the Inheritance Tax account for submission to HMRC, the practitioner needs to undertake a comprehensive review of the extent of the estate and its proposed distribution. The work required leading up to the submission of the account is described in detail in the
To view our latest tax guidance content, sign in to Tolley Guidance or register for a free trial.