Section 635 Creditor relationships: embedded derivatives which are options
United Kingdom
This section applies if in any accounting period—
a company is a party to a creditor relationship for the purposes of its F1basic life assurance and general annuity business, and
that creditor relationship is one in relation to which sections 415 and 585 (which both apply to loan relationships with embedded derivatives) would have effect but for the fact that the company accounts for the creditor relationship at fair value through profit and loss.
F2For the purpose of applying the I - E rules, this Part and Part 5 (loan relationships) have effect for that accounting period as they would if the creditor relationship were one in relation to which those sections have effect.
Annotations
Textual amendments
- F1
Words in s. 635(1)(a) substituted (17.7.2012) by Finance Act 2012 (c. 14), Sch. 16 para. 169(2)
- F2
Words in s. 635(2) substituted (17.7.2012) by Finance Act 2012 (c. 14), Sch. 16 para. 169(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)