HMRC is consulting until 16 November 2016 on draft regulations to extend for a further 20 years the interim regime which allows securitisation companies to continue basing their corporation tax computations on old UK GAAP, instead of international accounting standards.
HMRC is consulting until 16 November 2016 on draft regulations to extend for a further 20 years the interim regime which allows securitisation companies to continue basing their corporation tax computations on old UK GAAP, instead of international accounting standards. This allows them to continue to be taxed on their actual cash profit, rather than their accounting profit. The regulations also allow companies to elect out of this extension. The current interim regime is due to expire on 31 December 2016.
The interim regime was introduced in 2005, to prevent securitisation companies from being adversely affected by the introduction of international accounting standards, which could cause accounting results and therefore the taxable profits of such companies to be more volatile. The regime permitted companies to continue to use old UK GAAP as the basis for their tax computations, pending the adoption of a permanent securitisation regime in 2006.
The interim regime has previously been extended twice, but is due to expire by 1 January 2017. The amending regulations are expected to come into force in December 2016 and apply to periods of account ending before 1 January 2037.
The draft Securitisation Companies (Application of Section 83(1) of the Finance Act 2005: Accounting Standards) (Amendment) Regulations 2016 and information for those wishing to comment are available here.
HMRC is consulting until 16 November 2016 on draft regulations to extend for a further 20 years the interim regime which allows securitisation companies to continue basing their corporation tax computations on old UK GAAP, instead of international accounting standards.
HMRC is consulting until 16 November 2016 on draft regulations to extend for a further 20 years the interim regime which allows securitisation companies to continue basing their corporation tax computations on old UK GAAP, instead of international accounting standards. This allows them to continue to be taxed on their actual cash profit, rather than their accounting profit. The regulations also allow companies to elect out of this extension. The current interim regime is due to expire on 31 December 2016.
The interim regime was introduced in 2005, to prevent securitisation companies from being adversely affected by the introduction of international accounting standards, which could cause accounting results and therefore the taxable profits of such companies to be more volatile. The regime permitted companies to continue to use old UK GAAP as the basis for their tax computations, pending the adoption of a permanent securitisation regime in 2006.
The interim regime has previously been extended twice, but is due to expire by 1 January 2017. The amending regulations are expected to come into force in December 2016 and apply to periods of account ending before 1 January 2037.
The draft Securitisation Companies (Application of Section 83(1) of the Finance Act 2005: Accounting Standards) (Amendment) Regulations 2016 and information for those wishing to comment are available here.
