Modernising the taxation of corporate debt and derivative contracts: draft guidance

Draft guidance on new legislation about Corporate Rescue Exemption to be included in the Corporate Finance Manual.



On 10 December 2014 the government published draft legislation to be included in Finance Bill 2015, together with explanatory notes. These include a schedule of amendments to the Corporation Tax rules on loan relationships in Part 5 of the Corporation Tax Act 2009 (CTA 2009).

New sections 322(5B) and 323A of CTA 2009 will remove the obligation to bring into account a loan relationships credit arising on a release, modification or replacement of debt in certain circumstances where a company is unable to pay its debts. The new sections will apply to the release, modification or replacement of a debtor relationship of a company on or after 1 January 2015.

This provisional guidance explains HM Revenue and Custom’s (HMRC) interpretation of the proposed legislation as published on 10 December 2014. It is published here to help companies and their advisers consider the application of the new legislation until the HMRC Corporate Finance Manual (CFM) is amended following the enactment of the legislation.

Comment is invited on this draft guidance and the final text incorporated into the CFM will take account of comments received and any amendments to the draft clauses.

Comments on this draft guidance should be sent to or

Published 12 January 2015