Chapter CFM70010
| Published date | 16 April 2016 |
| Record Number | CFM70010 |
| Court | HM Revenue & Customs |
Most of the tax rules relating to corporate finance are to be found in the legislation in Parts 5 to 7 of CTA 2009 which deal with loan relationships and derivative contracts. However, there are a number of rules relating to the taxation of corporate debt which are to be found outside the main body of the loan relationships and derivative contracts legislation.
The rules are those found in:
- other parts of CTA09
- other primary tax legislation
- secondary legislation (Regulations and Orders) made under powers in Parts 5 to 7 CTA09.
Below is a summary of these other rules on corporate debt.
Exemptions from loan relationshipsPart 19 of CTA09 sets out exemptions from corporation tax. These exemptions include a number of types of income that would otherwise be taxable under the loan relationships rules. CFM70100 has more details.
Banks and building societiesCFM71000 explains particular rules for banks and building societies, on dormant accounts, unclaimed assets, and on transfers of building society business.
Securitisation companiesThere are particular rules governing the taxation of certain types of company involved in securitisations. See CFM72000.
Structured financeRules on ‘structured finance arrangements’ were introduced by FA 2006. These rules treat certain arrangements that have the economic effect of lending as if they were loan relationships. See CFM73000.
Stock lending and manufactured payments and reposStock lending is a financial arrangement that involves the transfer of securities. It is similar in form to sale and repurchase arrangements (‘repos’) that are a form of secured loan. The loan relationships tax rules that apply to repos are explained in CFM46000.
CFM74000 explains the tax rules on stock lending, and the ‘manufactured payments’ that are a feature of both stock lending and repos.
Deduction of taxDeduction of tax is required from certain payments of interest and annual payments. CFM75000 sets out these rules.
Changes of accounting practiceRegulations have been made to ensure that certain amounts arising on the transition to International Accounting Standards are brought into account (or deferred, or exempt from being brought into account. See CFM76000.
Transfers of income streamsLegislation to counter the selling of an income stream to try to turn economic income into a capital return was enacted in FA 2009. See CFM77000.
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