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Part B: Applying the tests for debt and equity interests

Determine whether distributions may be frankable (equity) or deductible (debt) to the entity making the distribution.

Last updated 18 November 2025

Redeemable preference shares

Steps to work out whether redeemable preference shares are a debt or equity interest.

Converting preference shares

Steps to work out whether converting preference shares are a debt or equity interest.

Convertible notes

Steps to work out whether convertible notes are a debt or equity interest.

Connected entity at call loan

Steps to work out whether a connected entity on call loan is a debt or equity interest.

Non-share capital account

How to record non-share equity interests.

QC36047