Introduction Overview Overview Section 7: UK resident company operating in currency other than sterling and preparing accounts in another currency
52.This section sets out the second special rule. It is based on section 92B of FA 1993.
53.This special rule applies to a UK resident company whose functional currency is not sterling (see subsection (1)(b) and (c )), that prepares its accounts in a currency that is different from its functional currency and which has prepared its accounts in accordance with GAAP. It is immaterial whether the currency used to prepare the accounts is sterling or another currency.
54.When this special rule applies, the company’s profits or losses (adjusted to comply with corporation tax rules) must be calculated in the functional currency. The resulting amount of those profits or losses must then be translated from the functional currency into sterling (see subsection (2)).