Section 937F Ring-fenced scheme losses and relevant scheme profitsF1

(1)

Subsection (2) applies if—

(a)

a company makes one or more scheme losses in an accounting period in relation to a risk transfer scheme, and

(b)

disregarding any profits or losses made otherwise than as a result of the scheme, the relevant group makes a pre-tax economic loss in the period as a result of fluctuations in the scheme rate, index or value.

(2)

The relevant proportion of each scheme loss made by the company in the accounting period is a “ring-fenced scheme loss”.

(3)

For this purpose “ the relevant proportion ” means—

\frac{A - B - C}{A}

where—

A is the total of the scheme losses made in the period in relation to the scheme by the members of the relevant group,

B is the total of the scheme profits made in the period in relation to the scheme by the members of the relevant group, and

C is the pre-tax economic loss referred to in subsection (1)(b).

(4)

Subsection (5) applies if—

(a)

a company makes one or more scheme profits in an accounting period in relation to a risk transfer scheme, and

(b)

disregarding any profits or losses made otherwise than as a result of the scheme, the relevant group makes a pre-tax economic profit in the period as a result of fluctuations in the scheme rate, index or value.

(5)

The relevant proportion of each scheme profit made by the company in the accounting period is a “relevant scheme profit”.

(6)

For this purpose “ the relevant proportion ” means—

\frac{A - B - C}{A}

where—

A is the total of the scheme profits made in the period in relation to the scheme by the members of the relevant group,

B is the total of the scheme losses made in the period in relation to the scheme by the members of the relevant group, and

C is the pre-tax economic profit referred to in subsection (4)(b).

Annotations

Textual amendments

F1: Pt. 21A inserted (with effect in accordance with Sch. 16 para. 5 of the amending Act) by Finance Act 2010 (c. 13), Sch. 16 para. 3