Section 607 Pre-contract or abortive expenses

United Kingdom

(1)

This section applies if—

(a)

a company may enter into a derivative contract or related transaction but has not yet done so,

(b)

it incurs any expenses for purposes connected—

(i)

with entering into it, or

(ii)

with giving effect to any obligation which might arise under it, and

(c)

had the company entered into the contract or transaction, the expenses would be expenses within F1section 594A(1)(b).

(2)

The expenses are treated as expenses in relation to which debits may be brought into account in accordance with F2section 595(2) to the same extent as if the company had entered into the contract or transaction.

Annotations

Textual amendments

F1: Words in s. 607(1)(c) substituted (with effect in accordance with Sch. 7 Pt. 6 of the amending Act) by Finance (No. 2) Act 2015 (c. 33), Sch. 7 para. 70(2)
F2: Words in s. 607(2) substituted (with effect in accordance with Sch. 7 Pt. 6 of the amending Act) by Finance (No. 2) Act 2015 (c. 33), Sch. 7 para. 70(3)

Notes on Part 7

Modifications

C1: Pt. 7 modified (with effect in accordance with s. 1184(1) of the amending Act) by Corporation Tax Act 2010 (c. 4), ss. 601, 1184(1) (with Sch. 2)
C2: Pt. 7 modified (with effect in accordance with s. 148 of the amending Act) by Finance Act 2012 (c. 14), s. 88(1)(2)(7) (with s. 147, Sch. 17)
C3: Pt. 7 modified by 2007 c. 3, s. 809FZZ(8) (as inserted (with effect in accordance with s. 37(4) of the amending Act) by Finance Act 2016 (c. 24), s. 37(2))
C4: Pt. 7 modified (for the tax year 2026-27 and subsequent tax years (but in relation to investment management services whenever performed)) by 2005 c. 5, Sch. A1 para. 35(6) (as inserted by Finance Act 2026 (c. 11), s. 58(6), Sch. 11 para. 1)

Notes on Miscellaneous

Textual amendments

F1: Pt. 7 Ch. 3 cross-heading inserted (with effect in accordance with Sch. 21 para. 11 of the amending Act) by Finance Act 2009 (c. 10), Sch. 21 para. 8