Corporation Tax Act 2009 section 307

General principles about the bringing into account of credits and debits

Section 307 establishes the general principle that credits and debits for loan relationships must follow the amounts recognised in a company's accounts under generally accepted accounting practice, with rules for apportionment where accounting periods and periods of account do not align.

• Credits and debits brought into account for loan relationships are based on amounts recognised in the company's profit or loss under generally accepted accounting practice.
• Where a company's accounting period does not coincide with its period of account, amounts must be apportioned on a time basis under section 1172 of CTA 2010.
• If time-basis apportionment would produce an unreasonable or unjust result, the amounts should instead be those that would have been recognised had accounts been drawn up for the accounting period in question.
• These general principles are subject to the other, more specific provisions elsewhere in Part 5 of the Act.