Part 14Remediation of contaminated or derelict land

Chapter 5Tax avoidance

1169Artificially inflated claims for relief or tax credit

(1)

To the extent that a transaction is attributable to arrangements entered into wholly or mainly for a disqualifying purpose, it is to be disregarded for the purposes mentioned in subsection (2).

(2)

Those purposes are determining for an accounting period the amount of—

(a)

any relief to which a company is entitled under Chapter 2,

(b)

any land remediation tax credits to which a company is entitled under section 1151,

(c)

any relief to which a company carrying on life assurance business is entitled under section 1161 F1or 1162, and

(d)

any life assurance company tax credits to which such a company is entitled under section 1164.

(3)

Arrangements are entered into wholly or mainly for a “disqualifying purpose” if their main object, or one of their main objects, is to enable a company to obtain—

(a)

relief under Chapter 2 to which the company would not otherwise be entitled or of a greater amount than that to which it would otherwise be entitled,

(b)

a land remediation tax credit to which it would not otherwise be entitled or of a greater amount than that to which it would otherwise be entitled,

(c)

relief under section 1161 F2or 1162 to which it would not otherwise be entitled or of a greater amount than that to which it would otherwise be entitled, or

(d)

a life assurance company tax credit to which it would not otherwise be entitled or of a greater amount than that to which it would otherwise be entitled.

(4)

In this section “arrangements” includes any scheme, agreement or understanding, whether or not legally enforceable.