Commentary on Sections Overview Chapter 2: Accrued income profits and losses Section 673: Meaning of “interest period”
1992.This section defines “interest period” for the purposes of this Chapter. It is based on section 711(3) of ICTA.
1993.If the period between interest payment days exceeds twelve months, it is not an interest period. Instead, the first twelve months of the period, each succeeding period of twelve months within that period, and any rump period, is an interest period. This ensures that charges under the accrued income scheme cannot be deferred by having long intervals between interest payment days.
1994.Subsection (1) defines when an interest period begins and when an interest period ends (which includes when twelve months has expired). This is subject to special rules in some cases – see subsections (3) to (6).
1995.See Change 106 in Annex 1 which amends the meaning of “interest period” in relation to this section.