Section 814B — Corporation Tax Act 2010: Key definitions

Key definitions 814B 1 For the purposes of the Corporation Tax Acts a company has a manufactured dividend relationship if conditions A to C are met.

2 Condition A is that under any arrangements—

a an amount is payable by or to the company, or b any other benefit is given by or to the company (including the release of the whole or part of any liability to pay an amount).

3 Condition B is that the arrangements relate to the transfer of shares in a company.

4 Condition C is that the amount or value of the other benefit—

a is representative of a dividend on the shares, or b will fall to be treated as representative of such a dividend when it is paid or given.

5 In subsection (2) the reference to an amount being payable, or other benefit being given, by the company includes a reference to an amount being payable, or other benefit being given, by another person on behalf of the company.

6 In this Part— “ manufactured dividend ”, in relation to a manufactured dividend relationship, means an amount, or the value of a benefit, within subsection (2), and “ the real dividend ” means the dividend mentioned in subsection (4)(a).