Section 539 — Corporation Tax Act 2009: Introduction to Chapter

Introduction to Chapter 539 1 This Chapter deals with the application of Part 5 to manufactured interest relationships and payments representative of interest.

2 For the purposes of the Corporation Tax Acts a company has a manufactured interest relationship if conditions A and B are met.

3 Condition A is that—

a an amount is payable by or on behalf of the company or to the company under any arrangements, and b the arrangements relate to the transfer of an asset representing a loan relationship.

4 Condition B is that the amount—

a is representative of interest under the loan relationship, or b will fall to be treated as representative of such interest when it is paid.

5 In this Chapter— “ manufactured interest ”, in relation to a manufactured interest relationship, means an amount within subsection (3)(a), and “ the real interest ” means the interest mentioned in subsection (4)(a).

6 References in the Corporation Tax Acts to a company being a party to a manufactured interest relationship are to be read in accordance with this section. 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .