| answer text |
<p>Fines imposed as a punishment by regulators are non-deductible for UK Corporation
Tax purposes, while compensation expenditure arising from trading activity is in principle
deductible.</p><p> </p><p>However, the government took steps in Finance Act (No2)
2015 to make compensation associated with bank misconduct and mis-selling non-deductible
and offset the deductibility of administrative costs associated with this compensation
through a taxable receipt. This action is forecast by the OBR to increase banks’ tax
payments by around £1bn over the next 5 years.</p>
|
 |
