BIM39540 - Foreign exchange: gains or losses: capital or revenue: summary
The following guidelines will cover most cases and are intended to ensure consistency of approach.
Period of borrowing | Amount of borrowing - Fixed | Amount of borrowing - Fluctuating |
---|---|---|
Less than 12 months | Revenue | Revenue |
12 months or longer | Capital | ‘Use’ test is relevant |
Less than 12 months but renewable beyond then | Revenue but see BIM39530 | Revenue but see BIM39530 |
These guidelines should be applied flexibly and with common sense, for instance in deciding the nature of a borrowing for a period of less than, or not significantly more than, a year.