Taxes Consolidation Act 1997 section 835AAE

Carry forward of total spare capacity

Section 835AAE allows a relevant entity to carry forward its total spare capacity for up to 60 months and use it to reduce disallowable amounts arising under the interest limitation rule.

• Total spare capacity can be carried forward for up to 60 months (the "relevant period") from the end of the accounting period in which it arose.
• A claim can be made to use carried-forward spare capacity to reduce a disallowable amount arising in a later accounting period within the relevant period.
• Where spare capacity from more than one period is available, capacity from earlier periods must be used in priority to capacity from later periods.
• Where an accounting period straddles the end of the relevant period, the available spare capacity is time-apportioned.