LLM7110 - Double taxation relief: corporate members: Regulations: calculating the foreign tax pool: ‘correspondence’ between accounting periods and foreign periods of accounting

It is necessary to relate tax payable for a foreign period of accounting (FPA) to a UK accounting period (AP). An FPA and AP “correspond” if the FPA ends in the 12 months preceding the beginning of the AP. If there is more than one such FPA, each or all corresponds to the AP. If (because there is an AP of less than 12 months) under this rule the FPA could correspond with more than one AP, it is taken to correspond only to the first of those APs. Should an FPA exceed 12 months, it is treated as split into successive 12 month periods plus any balance. Such complexities are rare, and generally an FPA will correspond with the next AP to begin after its cessation.

The amount of foreign tax payable for a corresponding FPA, that may require restriction as explained at LLM7120, when calculating relief available for an AP, is called the ‘foreign amount of tax’.