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HMRC internal manual

General Insurance Manual

Double taxation relief: foreign tax on investment income: accounting periods beginning on or after 1 April 2000: section 804C ICTA 1988: the first limitation - for expenses


The first limitation, in ICTA88/S804C (3), requires the relevant income to be reduced(but not below nil so as to create a loss or relief) by the amount of expenses attributable to the income. The expenses attributable to the relevant income are the appropriate fraction of the total relevant expenses of general business for the period, and that fraction is (section 804C(7)):

the item of income to which the foreign tax relates referable to general business

                                     the total income of the business

If the total income (the meaning of which is explained in GIM12240) is nil then the denominator becomes the total of all the relevant income of the business (section 804C(8)).

GIM12230 gives an example of the limitation under section 804C.