Section 569 — Corporation Tax Act 2009: Restriction on debits on old contracts: non-fair value accounting cases

Restriction on debits on old contracts: non-fair value accounting cases 569 1 This section applies where—

a the relevant company brings into account credits and debits in respect of the old contract otherwise than on the basis of fair value accounting, and b the carrying value of the old contract, as recognised for accounting purposes immediately before the beginning of the first accounting period, exceeds its fair value at that time.

2 No amount is to be brought into account as a debit in relation to the old contract by the relevant company as a result of section 562 except so far as the total of—

a the amount of the debit, and b the amount of any other debits which have previously arisen in relation to the contract as a result of that section, is greater than the excess mentioned in subsection (1)(b).