Corporation Tax Act 2009

175 Withdrawal of relief

(1) This section applies if—

(a) some or all of an unremittable amount has been deducted from profits under section 173, and

(b) any of the following events occurs.

(2) The events are that—

(a) the amount or part of it ceases to be unremittable,

(b) an allowable provision for impairment loss is made in respect of the amount or part of it,

(c) the amount or part of it is used to finance expenditure or investment outside the United Kingdom,

(d) the amount or part of it is applied outside the United Kingdom in another way,

(e) the amount or part of it is exchanged for, or discharged by, an amount that is not unremittable, and

(f) if the amount is an amount owed, a payment under a contract of insurance is received in relation to the amount or part of it.

(3) The amount or the part of it in question is brought into account as a receipt in calculating the profits of the trade of the period of account in which the event occurs, but only so far as—

(a) it has been deducted from profits under section 173, and

(b) it has not already been brought into account as a receipt in calculating the profits of the trade as a result of this section.

(4) If the event is the receipt of a payment under a contract of insurance, the amount brought into account as a receipt must not exceed the amount of the payment.

(5) In subsection (2)(b) “allowable provision for impairment loss” means either—

(a) a debit in respect of the impairment of a financial asset (see section 476(1)) which is brought into account under Part 5 (loan relationships), or

(b) a provision in respect of which a deduction is allowable under section 55 (bad debts).