A full corporate interest restriction return must contain details of all the relevant companies in the worldwide group. It should set out a statement of calculations to include details of the tax-interest and tax-EBITDA figures for all companies, any disallowance in the period and how this is to be allocated between group companies. It should also contain a statutory declaration and any elections made.
An abbreviated return is, as the name suggests, a shortened version of a full return. An abbreviated return can only be submitted where the group is not subject to any interest restriction for the period. The submission must still include details of all the relevant companies in the worldwide group along with a statutory declaration that there is no restriction in the period. No calculation is required.
A group that is not subject to an interest restriction is not obliged to appoint a reporting company or file a return, unless HMRC appoints a reporting company, in which case a return must be filed. The key incentive to file a return in such circumstances is that this allows the group to carry forward any unused interest allowance. This may then be used to reduce restrictions in later periods.
Once a return is filed for a period in which no restriction arises, a revised return may be submitted at any time up to 60 months after the end of the period to which the return relates. Filing an abbreviated return allows companies to access the interest allowance from periods up to five years prior, while reducing the immediate compliance burden of a full return.
We are happy to discuss the features of an abbreviated return in more detail and how we can help your group. Please do not hesitate to get in touch with our experts.