Section 430 | Interest allowance (consolidated partnerships) election ^F1

(1)Where an interest allowance (consolidated partnerships) election (see paragraph 18 of Schedule 7A) has effect in relation to a period of account of a worldwide group, this Chapter applies in relation to the period subject to this section.

(2)The financial statements of the group for the period are treated as if—

(a)no amounts were recognised in them, as items of profit or loss, in respect of any income or expenses of a specified consolidated partnership, and

(b)instead, each specified consolidated partnership were accounted for using the equity method.

(3)In subsection (2)(b) “the equity method” has the meaning it has for accounting purposes.

(4)In this Part “consolidated partnership”, in relation to a period of account of a worldwide group, means a partnership in relation to which conditions A and B are met.

(5)Condition A is that, in the financial statements of the worldwide group for the period, the results of the partnership are consolidated with those of the ultimate parent as the results of a single economic entity.

(6)Condition B is that at no time during the period does the partnership have a subsidiary that is a company.

(7)In this section—

(a)“specified” means specified in the interest allowance (consolidated partnerships) election or elections;

(b)“subsidiary” has the meaning given by international accounting standards.