Section 486D — Corporation Tax Act 2009: Exclusion where arrangement has no tax avoidance purpose

Exclusion where arrangement has no tax avoidance purpose 486D 1 This Chapter does not apply in relation to a return produced by an arrangement to which a company is a party unless it is reasonable to assume that the main purpose, or one of the main purposes, of the company being a party to the arrangement is to obtain a relevant tax advantage.

2 But a company for which a return is produced by an arrangement to which this Chapter would otherwise be prevented from applying by subsection (1) may elect that this Chapter is to apply in relation to the return.

3 An election under subsection (2)—

a may not be made by a company if section 486B applies to the company in relation to the return in accordance with subsection (6) of that section, b must be made no later than the time when the arrangement begins to produce a return for the company, and c is irrevocable.

4 In this section “ obtain a relevant tax advantage ” means secure that the return (or any part of it) is produced in a way which means that its treatment for corporation tax purposes is more advantageous to the company than it would be if it were—

a charged to corporation tax as income of the company, or b brought into account as income of the company for corporation tax purposes, at the time when amounts would be brought into account in relation to the return in accordance with section 486B. 5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .