Extension of the corporation tax interim securitisation regime

Extension of the corporation tax interim securitisation

The interim regime for securitisation companies has been extended to apply to periods of account ending before 1 January 2037.


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Upon the introduction of International Accounting Standards in 2005, the accounting results, and therefore the taxable profits, of securitisation companies were made more volatile. To address this, in 2005 the Government introduced specific legislation for securitisation companies known as the ‘interim regime’ to prevent them from being adversely affected, pending the adoption of a permanent securitisation regime in 2006. The interim regime permitted those companies to ignore the accounting changes in computing their corporation tax liabilities. The interim regime was due to expire on 1 January 2017. However, HMRC are extending this, which will now apply to periods of account ending before 1 January 2037. It is said that there is no intention to extend the regime beyond 2037.

It will be possible to make an irrevocable election to disapply the extension of the regime. The deadline for the election will be the later of the end of the first accounting period ending on or after 1 January 2017 and 31 March 2017, e.g. by 31 December 2017 for a company which prepares its accounts to 31 December each year. However, companies with a 31 March year end would need to elect by 31 March 2017.

The regulations, when finalised, are expected to come into force in December 2016. A draft version of the regulations to enact this change has been published for a period of technical consultation, which will close on 16 November 2016. A Tax Information and Impact Note has also been released.


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Rob Norris

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