Regulation 10 Interest distributions: effect for investment trust or prospective investment trust

(1)

This regulation applies in respect of an accounting period if a company—

(a)

is an investment trust or prospective investment trust in respect of the accounting period, and

(b)

makes an interest distribution in relation to the accounting period.

(2)

Subject to paragraph (3), the Corporation Tax Acts have effect in relation to the company as if the interest distribution made by the company in relation to the accounting period were interest under a debtor relationship of the company (and, accordingly is an amount recognised in determining the company’s profit or loss for the period).

(3)

Paragraph (2) does not apply to the extent that the aggregate of the amount distributed as interest distributions in relation to the accounting period exceeds the amount of the company’s qualifying interest income for that period.

(4)

In paragraph (2) “debtor relationship” has the same meaning as in section 302(6) of the Corporation Tax Act 2009 (loan relationships).