Netting converts multiple settlement obligations into a single net obligation and governs matching deductions against interest income.

Netting requires a clearing corporation to determine a single net payment or delivery obligation by setting off inter-member claims and obligations arising from trading and specified events such as insolvency or liquidation, so that only a net claim or obligation is settled. In taxation, netting within computation provisions allows deductions for expenditures that have a nexus with interest receipts, matching related deductible expenses against interest income and leaving only any residual excluded from business profits.

---

---

---