Corporation Tax Act 2009 (c. 4)

Part 5 U.K. Loan Relationships

Modifications etc. (not altering text)

C1 Pt. 5 applied (with effect in accordance with Sch. 24 paras. 13-16 of the amending Act) by Finance Act 2009 (c. 10), Sch. 24 para. 15(2)(3)

C2 Pt. 5 applied (with modifications) (with effect in accordance with s. 1184(1) of the amending Act) by Corporation Tax Act 2010 (c. 4), ss. 990(5), 1184(1) (with Sch. 2)

Chapter 8 U.K. Connected parties relationships: late interest

Modifications etc. (not altering text)

C3 Pt. 5 Chs. 6-8 modified (with effect in accordance with s. 1184(1) of the amending Act) by Corporation Tax Act 2010 (c. 4), ss. 601, 1184(1) (with Sch. 2)

374 Connection between debtor and person standing in position of creditor U.K.

(1) The case to which this section applies is where there is for the actual accrual period a connection between—

(a) the company which has the debtor relationship, and

(b) a company [F1 ("C") ] standing in the position of creditor as respects the loan relationship

[F2 and the condition in subsection (1A) is met.]

[F3 (1A) The condition is that C is—

(a) resident for tax purposes in a non-qualifying territory at any time in the actual accrual period, or

(b) effectively managed in a non-taxing non-qualifying territory at any such time.]

(2) Section 466 (companies connected for an accounting period) applies for the purposes of this section.

[F4 (3) For the purposes of this section—

(a) “non-qualifying territory” has the meaning given by [F5 section 173 of TIOPA 2010],

(b) a non-qualifying territory is “non-taxing” if companies are not under its law liable to tax by reason of domicile, residence or place of management, and

(c) “resident for tax purposes” means liable, under the law of the non-qualifying territory, to tax there by reason of domicile, residence or place of management. ]

Textual Amendments

F1 Word in s. 374(1)(b) inserted (with effect in accordance with Sch. 20 para. 9 of the amending Act) by Finance Act 2009 (c. 10), Sch. 20 para. 2(2)(a)

F2 Words in s. 374(1) inserted (with effect in accordance with Sch. 20 para. 9 of the amending Act) by Finance Act 2009 (c. 10), Sch. 20 para. 2(2)(b)

F3 S. 374(1A) inserted (with effect in accordance with Sch. 20 para. 9 of the amending Act) by Finance Act 2009 (c. 10), Sch. 20 para. 2(3)

F4 S. 374(3) inserted (with effect in accordance with Sch. 20 para. 9 of the amending Act) by Finance Act 2009 (c. 10), Sch. 20 para. 2(4)

F5 Words in s. 374(3)(a) substituted (with effect in accordance with s. 381(1) of the amending Act) by Taxation (International and Other Provisions) Act 2010 (c. 8), s. 381(1), Sch. 8 para. 127 (with Sch. 9 paras. 1-9, 22)