»Ê¹ÚÌåÓýapp

ICTA88/S247 was repealed by FA01 in relation to payments made after 11 May2001. This page relates to periods before that date.

Under ICTA88/S247 (4), where charges on income or interest giving rise to a debt under the loan relationships legislation (FA96) are to be paid:

• by a subsidiary company to its parent company or to another subsidiary, or
• by a parent company to its subsidiary,

the recipient company and the payer company may make a joint election for payment in full without the payer company having to account for IT.

»Ê¹ÚÌåÓýappre is guidance on the conditions for elections at CTM80085,and, for consortia at CTM80910.

»Ê¹ÚÌåÓýapp effect of an election under Section 247 (4) is to take the relevant payments outside the machinery within ICTA88/S349 for deducting and accounting for IT on such payments.While the election is in force the payer company must make payment in full. »Ê¹ÚÌåÓýappre is no effect on the CT treatment of the payments.

So they continue to:

• be allowable deductions as charges on income against the profits of the payer company, or to result in a debit under the loan relationship legislation

and

• to be included in the chargeable profits of the recipient company.