SCHEDULE 30 Financial Arrangements Avoidance
Finance Act 2009 (2009 c 10) | Legislation

SCHEDULE 30 Financial Arrangements Avoidance

Section 61

Interest payments: arrangements appearing very likely to produce post-tax advantage

1

(1)     In ITA 2007, after section 384 insert—

“384A Restriction on relief where arrangements minimise risk to borrower

(1)     Relief is not to be given under this Chapter for interest paid by a person on a loan if—

(a)     the loan is made to the person (“the borrowerâ€) as part of arrangements which appear very likely to produce a post-tax advantage, and

(b)     the arrangements seem to have been designed to reduce any income tax or capital gains tax to which the borrower (or any person whose circumstances are like those of the borrower) would be liable apart from the arrangements.

(2)     Arrangements “appear very likely†to produce a post-tax advantage if (and only if) it would be reasonable to assume from either or both of—

(a)     the likely effect of the arrangements, and

(b)     the circumstances in which the arrangements, or any parts of the arrangements, are entered into or effected,

that there is no risk, or only an insignificant risk, that they will not produce a post-tax advantage.

(3)     “Produce a post-tax advantage†means give rise to a sum or sums—

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