Section 175 — Corporation Tax Act 2009: Withdrawal of relief

Withdrawal of relief 175 1 This section applies if—

a some or all of an unremittable amount has been deducted from profits under section 173, and b any of the following events occurs.

2 The events are that—

a the amount or part of it ceases to be unremittable, b an allowable provision for impairment loss is made in respect of the amount or part of it, c the amount or part of it is used to finance expenditure or investment outside the United Kingdom, d the amount or part of it is applied outside the United Kingdom in another way, e the amount or part of it is exchanged for, or discharged by, an amount that is not unremittable, and f if the amount is an amount owed, a payment under a contract of insurance is received in relation to the amount or part of it.

3 The amount or the part of it in question is brought into account as a receipt in calculating the profits of the trade of the period of account in which the event occurs, but only so far as—

a it has been deducted from profits under section 173, and b it has not already been brought into account as a receipt in calculating the profits of the trade as a result of this section.

4 If the event is the receipt of a payment under a contract of insurance, the amount brought into account as a receipt must not exceed the amount of the payment.

5 In subsection (2)(b) “ allowable provision for impairment loss ” means either—

a a debit in respect of the impairment of a financial asset (see section 476(1)) which is brought into account under Part 5 (loan relationships), or b a provision in respect of which a deduction is allowable under section 55 (bad debts).