Revenue has updated its guidance on deposit interest – whether a trading receipt to outline when deposit interest can be treated as a trading receipt. The guidance confirms that to qualify as a trading receipt, the funds must be considered an integral aspect of the trade.
The guidance also clarifies that in general, interest earned on funds placed on deposit, which are deemed to be in excess of a company’s business needs, are not considered income taxable under Case I. This is on the basis that Revenue deems such funds as not being integral to the company’s trading activities.
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