National Insurance Contributions Act 2014

Connection through a loan creditor U.K.

5 (1) A company (“A”) is not under the control of another company (“B”) for the purposes of paragraph 2(1) if— U.K.

(a) B is a loan creditor of A,

(b) there is no other connection between A and B, and

(c) either—

(i) B is not a close company, or

(ii) B's relationship to A as a loan creditor arose in the ordinary course of a business which B carries on.

(2) Sub-paragraph (3) applies if—

(a) two companies (“A” and “B”) are under the control of the same person who is a loan creditor of each of them,

(b) there is no other connection between A and B, and

(c) either—

(i) the loan creditor is a company which is not a close company, or

(ii) the loan creditor's relationship to each of A and B as a loan creditor arose in the ordinary course of a business which the loan creditor carries on.

(3) In determining under paragraph 2(1) if A and B are connected with one another, rights which the loan creditor has as a loan creditor of A, or as a loan creditor of B, are ignored.

(4) In sub-paragraph (2)(a) “control” has the same meaning as in paragraph 2(1).

(5) In this paragraph—

(a) “close company” is to be read in accordance with Chapter 2 of Part 10 of CTA 2010 (see, in particular, section 439 of that Act),

(b) “connection” includes a connection in the past as well as a connection in the present and references to a connection between two companies include any dealings between them, and

(c) references to a loan creditor of a company are to be read in accordance with section 453 of CTA 2010.