Introduction Equity holders Overview Section 125: Assumptions as to accounting periods
466.This section is the third of four sets of assumptions to be made in recalculating the EEA amount using United Kingdom tax rules.It is based on paragraph 14 of Schedule 18A to ICTA.
467.Subsection (1) determines the start of the accounting period for recalculating the surrendering company’s EEA amount.
468.Subsections (2) to (4) determine when the accounting period ends. As in section 10 of CTA 2009, the accounting period ends at the end of the EEA accounting period or, if earlier, after 12 months.
469.The section clarifies the position if, exceptionally, the EEA accounting period is longer than two years. Paragraph 14 of Schedule 18A to ICTA does not explicitly cater for this possibility butthe only logical interpretation involves treating the process in sub-paragraphs (2) to (4) as iterative. So this section does not change the law.