{
  "url": "https://openlegislation.uk/finance-act-2002-schedule-26-parts-2-and-9-amendment-no-2-order-2004/note",
  "json_url": "https://openlegislation.uk/finance-act-2002-schedule-26-parts-2-and-9-amendment-no-2-order-2004/note.json",
  "legislation": "uksi/2004/3270",
  "legislation_title": "The Finance Act 2002, Schedule 26, Parts 2 and 9 (Amendment No. 2) Order 2004",
  "legislation_url": "https://openlegislation.uk/finance-act-2002-schedule-26-parts-2-and-9-amendment-no-2-order-2004",
  "path": "note",
  "kind": "note",
  "number": null,
  "heading": "Explanatory note",
  "text": "(This note is not part of the Order)\nArticle 1 provides for the citation, commencement and effect of the Order.\nArticle 2 introduces the amendments to Part 2 which are made by articles 3 and 4.\nArticle 5 introduces the amendments made to Part 9 which are made by articles 6 to 12.\nThe effect of the amendments to Part 9 is to exclude certain profits and losses on some derivative contracts from the charge to corporation tax as income and, in certain cases, instead to provide for them to be charged to corporation tax as chargeable gains. The derivative contracts to which the amendments apply are those which are deemed to exist as a result of section 94A Finance Act 1996 which provides for the accounting treatment applicable to complex financial instruments to be followed for tax purposes by the bifurcation of the instrument into a debt component and a derivative component.\nThe amendments to Parts 2 and 9 also apply to exclude from the charge to corporation tax as income certain profits and losses on some derivative contracts deemed to be embedded in contracts which are not themselves financial assets or liabilities.\nThe amendments made by article 12 align paragraph 50A of Schedule 26 with paragraph 19A Sch 9 Finance Act 1996, its counterpart in Chapter 2 Part 4 Finance Act 1996. They also ensure that the comparison in paragraph 50A of the carrying value of derivative contracts is of that value as adjusted for tax purposes.\nThis Order does not impose any new costs on business.",
  "extent": null,
  "status": null,
  "version": "current",
  "annotations": [],
  "outstanding_effects": [],
  "provenance": {
    "source": "legislation.gov.uk",
    "source_url": "https://www.legislation.gov.uk/uksi/2004/3270/note",
    "retrieved_at": "2026-10-29T05:13:29.088547+00:00"
  },
  "licence": "Open Government Licence v3.0",
  "licence_url": "https://www.nationalarchives.gov.uk/doc/open-government-licence/version/3/",
  "attribution": "Contains public sector information licensed under the Open Government Licence v3.0. Source: legislation.gov.uk, The National Archives."
}