MTT21160 - Calculating the effective tax rate: Adjusted profits: Revaluation method gain or loss
A gain or loss is to be included in the adjusted profits if it arises due to the use of an accounting practice that:
- periodically adjusts the carrying value of the member’s property, plant and equipment (as defined by International Accounting Standard 16),
- records the changes in value in the member’s accounts, outside of the profit and loss account, and
- does not subsequently report the gains or losses in the profit and loss account.
Where such gains and losses are not reflected in the underlying profits, an adjustment is required in accordance with section 143 of Finance (No.2) Act 2023.
Note that the amount to be included is the gain or loss before adjustments to reflect tax expense amounts.