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F(No.2)A17/Sch5/Part 4

»Ê¹ÚÌåÓýapp Corporate Interest Restriction rules come into effect on 1 April 2017. »Ê¹ÚÌåÓýappy therefore apply for all periods of account of a worldwide group starting on or after that date. For groups that have a straddling period of account, this period is treated as split into two notional periods of account.

»Ê¹ÚÌåÓýapp Worldwide Debt Cap rules are repealed with effect from 1 April 2017. »Ê¹ÚÌåÓýapp rules governing the repeal mirror the commencement rules in relation to straddling periods.

In addition, the following rules apply on transition to the new corporate interest restriction regime:

• »Ê¹ÚÌåÓýappre are a number of extended time limits that apply for the first year of the rules.
• Certain amounts in respect of previous accounting and tax changes are excluded from the regime.
• Certain adjustments are made to the group’s financial statements in two situations to address group mismatches.
• Groups may make an election to be treated, for the purposes of these rules, as if they had elected into regulations 7, 8 and 9 of the Disregard Regulations.
• Existing guarantees as at 1 April 2017 are grandfathered such that they do not themselves cause debt to be related party debt. Likewise, any finance lease in existence as at 1 April 2017 is not considered to be a related party debt.
• Transitional infrastructure rules which can apply to accounting periods beginning before 1 April 2018 give the business time to restructure if necessary to qualify for the main infrastructure rules. In addition, there is limited grandfathering of loans funding assets that have a highly predictable income based on qualifying public contracts.
• Specific provisions limit the effect of the regime anti avoidance rule for certain restructurings in connection with commencement.