Section 809BZH — Income Tax Act 2007: Certain tax consequences not to have effect

Certain tax consequences not to have effect 809BZH 1 This section applies if—

a there is a type 2 finance arrangement, and b any relevant change in relation to the partnership would have the relevant effect (ignoring this section).

2 In such a case—

a Part 9 of ITTOIA 2005 (partnerships) is to have effect in relation to the transferor or the person connected with the transferor as if the relevant change in relation to the partnership had not occurred, and b accordingly the finance arrangement is not to have the relevant effect.

3 The relevant effect is that—

a an amount of income on which the transferor or the person connected with the transferor would otherwise have been charged to income tax is not so charged, b an amount which would otherwise have been brought into account in calculating for income tax purposes any income of the transferor or the person connected with the transferor is not so brought into account, or c the transferor or the person connected with the transferor becomes entitled to an income deduction.

4 In deciding whether subsection (1)(b) is met assume that amounts of income equal to the payments mentioned in section 809BZF(2)(e) were payable to the partnership before the relevant change in relation to it occurred.

5 An income deduction is—

a a deduction in calculating income for income tax purposes, or b a deduction from total income.