Corporation Tax Act 2010 section 269CC

Restriction on deductions for management expenses etc.

Section 269CC restricts the amount of pre-2015 carried-forward management expenses that a banking company may deduct when calculating its taxable total profits for an accounting period.

• Banking companies face a cap on deductions for management expenses and similar amounts carried forward from accounting periods ending before 1 April 2015.
• The maximum deductible amount is 25% of the company's relevant profits, reduced by certain carried-forward trade losses and non-trading loan relationship deficits already deducted.
• Pre-2015 carried-forward management expenses include both carried-forward expenses of management (and qualifying charitable donations) referable to periods ending before 1 April 2015, and certain property business losses from those periods treated as deductible management expenses.
• The restriction does not apply where the banking company has no relevant profits (i.e. total profits do not exceed nil) against which pre-2015 carried-forward management expenses could be set.