Finance Act 2015

80 UK company: involvement of entities or transactions lacking economic substance

(1) This section applies in relation to a company (“C”) for an accounting period if—

(a) C is UK resident in that period,

(b) provision has been made or imposed as between C and another person (“P”) (whether or not P is UK resident) by means of a transaction or series of transactions (“the material provision”),

(c) the participation condition is met in relation to C and P (see section 106),

(d) the material provision results in an effective tax mismatch outcome, for the accounting period, as between C and P (see sections 107 and 108),

(e) the effective tax mismatch outcome is not an excepted loan relationship outcome (see section 109),

(f) the insufficient economic substance condition is met (see section 110), and

(g) C and P are not both small or medium-sized enterprises for that period.

(2) For the purposes of subsection (1)(b) provision made or imposed as between a partnership of which C is a member and another person is to be regarded as provision made or imposed as between C and that person.