Section 468 — Corporation Tax Act 2009: Connection between companies to be ignored in some circumstances

Connection between companies to be ignored in some circumstances 468 1 In the case of a company (“ the creditor ”) which has a creditor relationship, any connection for an accounting period between the creditor and another company which stands in the position of a debtor as respects the debt is ignored for the purposes of the relevant provisions if the creditor is a party to the relationship in circumstances where—

a conditions A to E in section 469 (creditors who are financial traders) are met, or b conditions A, B and C in section 471 (creditors who are insurance companies carrying on basic life assurance and general annuity business) are met.

2 In subsection (1) “ the relevant provisions ” means any provisions of this Part which apply section 466.

3 Subsection (4) applies if for any accounting period subsection (1) has effect in the case of a creditor relationship of a company.

4 Subsection (1) does not apply for determining whether there is a connection between the two companies for the purposes of so much of any of the relevant provisions or of section 467 as relates to the corresponding debtor relationship.

5 For the purposes of this section and section 469, a company is treated as standing in the position of a debtor if it indirectly stands in that position by reference to a series of loan relationships or relevant money debts.

6 In subsection (5) “ relevant money debt ” means a money debt which would be a loan relationship if a company directly stood in the position of creditor or debtor.