Section 154A — Income Tax Act 2007: Anti-avoidance

Anti-avoidance 154A 1 Subsection (2) applies if—

a a person makes a loss in a relevant transaction, and b that loss arises directly or indirectly in consequence of, or otherwise in connection with, relevant tax avoidance arrangements.

2 The person is not to be given loss relief under section 152 for the loss.

3 Subsection (4) applies if—

a a person has income on which income tax is chargeable under, or by virtue of, a relevant section 1016 provision, and b that income arises directly or indirectly in consequence of, or otherwise in connection with, relevant tax avoidance arrangements.

4 The person is not to be given loss relief against that income under section 152.

5 In this section “ relevant tax avoidance arrangements ” means arrangements—

a to which the person is party, and b the main purpose, or one of the main purposes, of which is to obtain a reduction in tax liability by means of loss relief under section 152.

6 In subsection (5) “ arrangements ” includes any agreement, understanding, scheme, transaction or series of transactions (whether or not legally enforceable).