Corporation Tax Act 2009 section 308

Amounts recognised in determining a company's profit or loss

Section 308 defines what is meant by "an amount recognised in determining a company's profit or loss" for the purposes of the loan relationships rules in Part 5 of the Act.

• An amount is recognised in determining a company's profit or loss for a period if it appears as an item of profit or loss in the company's accounts for that period.
• This includes amounts originally recorded as other comprehensive income (OCI) that are subsequently reclassified (or "recycled") into profit or loss.
• The terms "item of profit or loss" and "item of other comprehensive income" take their standard accounting meanings as used under applicable accounting frameworks such as UK GAAP or IFRS.
• The definition ensures that the tax treatment of loan relationship amounts follows the accounting recognition of those amounts in the profit or loss section of the financial statements.