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Home / Simons-Taxes /Business tax /Part B2 How are trade profits and losses calculated? /Division B2.3 Trading expenses—general principles of deductibility /Introduction / B2.302 Relationship between rules prohibiting deductions and those allowing deductions
Commentary

B2.302 Relationship between rules prohibiting deductions and those allowing deductions

Business tax

ITTOIA 2005, Pt 2, Ch 4 (ss 32–55B)1 and CTA 2009, Pt 3, Ch 4 (ss 53–60A) contain a number of discrete provisions which prohibit or restrict the availability of a deduction in calculating the profits of the trade for tax purposes. As the starting point in the calculation will be the accounting profit before tax as calculated in accordance with GAAP, any restriction for such non-deductible expenses is made by 'adding back' the amount of the expense to the accounting profit.

The tax legislation provides guidance as to which provisions take priority over others to determine the expenditure which is deductible in calculating profits of the trade. This is intended to resolve any conflict between

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