Paragraph 5
United Kingdom
No deduction is allowed in respect of payments of interest or other financing costs by the permanent establishment to any other part of the non-resident company, except as provided by sub-paragraph (2).
The restriction in sub-paragraph (1) above does not apply to interest or other costs of financing that are payable in respect of borrowing by the permanent establishment in the ordinary course of a financial business carried on by it.
In sub-paragraph (2) “financial business” means any of the following—
banking, deposit-taking, money-lending or debt-factoring, or a business similar to any of those;
dealing in commodity or financial futures.
Notes on Schedule A1
Textual amendments
- F1
Sch. A1 repealed (1.4.2009 with effect in accordance with s. 1329(1) of the repealing Act) by Corporation Tax Act 2009 (c. 4), Sch. 1 para. 278, Sch. 3 Pt. 1 (with Sch. 2 Pts. 1, 2)
- F2
Sch. A1 inserted (with effect in accordance with s. 149(6) of the amending Act) by Finance Act 2003 (c. 14), s. 149(3), Sch. 25