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HMRC internal manual

Offshore Funds Manual

HM Revenue & Customs
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Reporting funds: computation of reportable income: figures to be used in computation - Regulation 63

The starting point for calculating the reportable income of a reporting fund for a period of account is, in the case of a fund using International Accounting Standards, the ‘total comprehensive income for the period’ as expressed in IAS1, or alternatively for a fund not using IAS, an equivalent amount.

An ‘equivalent amount’ means the amount specified in the fund’s application as ‘total comprehensive income for the period’’ and agreed by HMRC as being equivalent. For example, in the case of a fund using UK GAAP it will be the “total return before distributions” of the fund (see paragraph 3.33 of the Investment Management Association’s Statement of Recognised Practice (the IMA SORP - see OFM24400 for a definition of “IMA SORP”).

See HMRC website for details of acceptable GAAP’s (PDF 29KB)

Any adjustments to the starting point in reaching the figure for reportable income should only be made once, regardless of whether such an adjustment could fall to be made under more than one part of the Regulations, and where the result of the final calculation is negative then reportable income is taken to be nil.

The adjustments to be made to the starting figure in order to reach the figure for reportable income are explained in the following pages.