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HMRC internal manual

Company Taxation Manual

Corporation Tax: management expenses: raising finance

A company with investment business’  expenses on obtaining business finance, raising capital whether in terms of loans, shares or other products are not expenses of management within Section 1219. The same will apply to interest paid.

The authority for this treatment is variously in:

  • London County Freehold and Leasehold Properties Ltd v Sweet 24TC412
  • Hoechst Finance Ltd v Gumbrell 56TC594 and
  • Bennett v Underground Electric Railway of LondonLtd 8TC475.

However  some relief may be  provided under the loan relationships legislation in CTA09, Part5.  For details of the loan relationships legislation see the Corporate Finance Manual (CFM3000).