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Why do we need to calculate these amounts?

This guidance note sets out details of the initial calculations a group will need to undertake for the purposes of the corporate interest restriction (CIR) regime. For a general overview of the regime, see the Corporate interest restriction ― overview guidance note.

Having established who is part of the worldwide group, the next step to take when looking at the CIR is to calculate the aggregate net tax-interest expense for all companies in the worldwide group that are within the charge to UK corporation tax. In order to do this, it is necessary to calculate the net tax-interest expense (or income) for each relevant company and then sum these amounts. Details of how to go about this are set out under ‘Calculating tax-interest expense amounts’ below. Net tax-interest expense is also required to calculate tax-EBITDA.

In order to undertake the CIR calculations in both the fixed ratio method (see the Corporate