BKM208100 - Bank compensation restriction: qualifying company: overview
CTA09/S133A(5)
The bank compensation restriction denies a banking company corporation tax relief for compensation payments related to misconduct issues. The restriction also applies to compensation paid by any company to customers of a qualifying company where the compensation is in respect of the qualifying company바카라 사이트™s relevant conduct. A qualifying company is an associated company of the company incurring the expense. (CTA09/S133A(5)). Associated is defined at CTA09/S133L and largely follows the definitions used elsewhere in the Taxes Acts.
This rule means that banking groups cannot escape the restriction by paying the compensation through a related party (CTA09/S133A(3)(b)).
This rule also means the restriction may apply where a UK company incurs compensation expenditure to customers of an overseas banking company which is an associated company.
However, the rule will not apply if there is an arm바카라 사이트™s length arrangement between the two companies (CTA09/S133A(3)(b)). This ensures that a company that pays the compensation and recharges the expense on an arm바카라 사이트™s length basis is not unfairly penalised (BKM208200).