Corporation Tax Act 2009

486 Exclusion of exchange gains and losses in respect of tax debts etc

(1) No exchange gains or losses arise for the purposes of this Chapter if the money debt by reference to which the relevant non-lending relationship exists (“the relevant money debt”) is an amount of tax payable under the law of the United Kingdom.

(2) If the relevant money debt is an amount of tax payable under the law of a territory outside the United Kingdom, exchange gains or losses arise for the purposes of this Chapter only so far as a deduction in respect of the tax falls to be made under section 811 of ICTA (double taxation relief: deduction for foreign tax where no credit allowable).

(3) No exchange gains or losses arise for the purposes of this Chapter if the relevant money debt is an amount which would be deductible apart from—

(a) a statutory provision other than section 53 (capital expenditure), or

(b) a rule of law.

(4) The reference in subsection (3) to an amount being deductible is a reference to its being deductible—

(a) as an expense in calculating trading profits,

(b) as expenses of management within section 1219 (expenses of management of a company’s investment business), or

(c) as expenses falling to be brought into account at Step 1 of section 76(7) of ICTA (expenses of insurance companies).