Annex 1: Minor changes in the law Change 23: Recalculation of EEA amount: section 113
This change clarifies how the EEA amount is recalculated in a case where the EEA amount arises in a period that is longer than a year.
In accordance with paragraph 11 of Schedule 18A to ICTA the EEA amount must be recalculated in accordance with the “applicable UK tax rules”. Those rules include (paragraph 14 of the Schedule) any necessary splitting of the loss period in which the EEA amount arises to produce assumed accounting periods.
The amount that is available for surrender is limited to the amount given by the recalculation.
The recalculation necessarily involves apportionment of the EEA amount to the assumed accounting periods. But there is no rule to say how the comparison of the original and recalculated amount should be done: the original amount is for the whole loss period; the recalculated amount is for the assumed accounting periods.