Other tax rules on corporate debt: tax mismatch schemes: Meaning of economic profit or loss
CTA10/S938S sets out what is meant by the economic profit or loss for the purposes of the tax mismatch rules. It refers to a profit or loss being made by the company over the period of the scheme and taking into account:
- profits and losses made as a result of the Corporation Tax Acts; and
- any adjustments required to reflect the time value of money.
The term ‘profit’ or ‘loss’ in this context has its ordinary commercial meaning - real profits and losses and not just accounting entries.