188体育

Overview of Legislation

The legislation ensures that where companies, or groups of companies, enter into transactions that involve index-linked gilt-edged securities but the company or group is not economically exposed to the inflationary aspect of holding the index-linked gilt-edged security then the tax exemption by virtue of CTA09/S400(2) will not apply.

Referring to the example at CFM39120 this would mean that the 拢400m return that relates to the increase in carrying value due to movements in the RPI would not qualify for the tax exemption. The tax position of a 拢500m taxable credit and a 拢500m tax deduction would match the economic position for the company.