Part 9Leasing plant or machinery
Chapter 5Sales of lessors: anti-avoidance provisions
435Disregard of increases and decreases F4in certain amounts
1
This section applies if—
F2a
an amount mentioned in subsection (1A) is to be ascertained for the purpose of determining a question as to the application of Chapter 3 or 4,
b
apart from this section, there would be a reduction or increase in any such amount,
c
the reduction or increase arises directly or indirectly in consequence of, or otherwise in connection with, any arrangements, and
d
the main purpose, or one of the main purposes, of the arrangements is to secure that there is a relevant tax advantage.
F11A
The amounts are—
a
the relevant plant or machinery value,
b
the value of plant or machinery falling within section 387(7) or 410(6),
c
the relevant company's or partnership's income in the period of 12 months ending with the relevant day,
d
the amount of PM,
e
the amount of TWDV,
f
the amount of any disposal value to be substituted by section 398G(3), and
g
any underlying amount required to calculate or verify an amount mentioned in any of the preceding paragraphs.
2
There is a relevant tax advantage if (apart from this section)—
a
any company would not be regarded for the purposes of any provision of Chapter 3 or 4 as carrying on a business of leasing plant or machinery (whether alone or in partnership),
b
the amount of any income which any company is treated as receiving under any such provision would be reduced, F5...
c
the amount of any expense which any company is treated as incurring under any such provision would be increased F6, or
d
the amount of any disposal value to be substituted by section 398G(3) would be reduced.
3
For the purpose of determining the question as to the application of Chapter 3 or 4, the reduction or increase in the amount F3to be ascertained must be ignored.
4
In this section—
“arrangements” includes any agreement, understanding, scheme, transaction or series of transactions—
- a
whether or not legally enforceable, and
- b
whether or not the company for which the relevant tax advantage is intended to be secured is a party to the arrangements,
- a
“increase” includes an increase from nil, and
“reduction” includes a reduction to nil.