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HMRC internal manual

Bank Levy Manual

Relevant entities and groups: banking groups: UK resident bank: the capital resources condition

Paragraph 72 of Schedule 19

If the entity is not a member of a group, the capital resources condition sets out that the entity has a ‘capital resources requirement’ (within the meaning of the FSA’s Handbook of Rules and Guidance) at the end of the chargeable period of at least £100 million.

Paragraph 72(5) and (6) of Schedule 19

The capital resources condition includes two special rules which only need to be applied in relation to entities whose capital resources may be material to the £100 million threshold.

The first rule is that, if such an entity prepares its accounts in a currency other than sterling, the amount of its capital resources at the end of the chargeable period is to be translated into sterling by reference to the spot rate of exchange on last day of the chargeable period.

The second is that, if such an entity carries on a trade in the UK through a permanent establishment in the UK, its capital resources are to be determined as they would be for the purposes of corporation tax (see Chapter 4 of Part 2 of CTA 2009 and INTM267700 - external users can find the guidance at - onwards).

For bank levy purposes, ‘permanent establishment’ has the meaning given by Chapter 2 of Part 24 of CTA 2010. See INTM264050 (external users can find the guidance at ).

If the entity is a member of a group, see the section on capital resources requirement: groups at BKLM243170.