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F(No2)A17/C32/S19

Arrangements

For the purposes of the TAAR, the term arrangements includes any agreement, understanding, scheme, transaction or series of transactions (whether or not legally enforceable).

Tax advantage

»Ê¹ÚÌåÓýapp term tax advantage has the meaning given in CTA10/S1139. Any of the following would be a tax advantage:

• Relief from tax or increased relief from tax,
• A repayment of tax or increased repayment of tax,
• »Ê¹ÚÌåÓýapp avoidance or reduction of a charge to tax or an assessment to tax,
• »Ê¹ÚÌåÓýapp avoidance of a possible assessment to tax,
• »Ê¹ÚÌåÓýapp avoidance or reduction of a charge or assessment to a charge under TIOPA10/PART9A (controlled foreign companies),
• »Ê¹ÚÌåÓýapp avoidance or reduction of a charge or assessment to the bank levy under FA11/SCH19 (the bank levy), or
• »Ê¹ÚÌåÓýapp avoidance or reduction of a charge to diverted profits tax.

Loss-related tax advantage and relevant provisions

»Ê¹ÚÌåÓýapp term loss-related tax advantage uses the meaning of tax advantage given above. A tax advantage will be a loss-related tax advantage if it results from a deduction or increased deduction under any relevant provisions. »Ê¹ÚÌåÓýapp relevant provisions are as follows:

• CTA09/S457, S459, S461, S462, S463B, S463G and S463H (non-trading deficits from loan relationships)
• CTA09/S753 (non-trading losses on intangible fixed assets),
• CTA09/S1219 (management expenses etc.),
• CTA10/S37, s45, s45A, s45B and s45F (deductions in respect of trade losses),
• CTA10/S62(3) (losses of a UK property business),
• CTA10/PART5 (group relief),
• CTA10/PART5A (group relief for carried-forward losses),
• CTA10/S303B, 303C and 303D (non-decommissioning losses of oil and gas ring-fence trades),
• FA12/S124A, S124B, S124C (excess carried-forward BLAGAB trade losses).

»Ê¹ÚÌåÓýappse are also the relevant provisions for the purposes of Condition B of the TAAR, which relates to circumvention or exploitation of these provisions.

Main purpose

»Ê¹ÚÌåÓýapp legislation applies only to arrangements where the purpose or one of the main purposes is to secure a tax advantage. »Ê¹ÚÌåÓýapp legislation does not define what is meant by purpose or main purposes. »Ê¹ÚÌåÓýappse expressions are to be given their normal meaning as ordinary English words. »Ê¹ÚÌåÓýappy have to be applied objectively, having regard to the full context and facts.

It will usually be clear whether trying to obtain a tax advantage is the purpose or one of the main purposes of a particular arrangement. Such would be the case, for example, where the arrangement would not have been carried out at all were it not for the opportunity to obtain the tax advantage, or where any non-tax purpose was equal to or secondary to the purpose of obtaining the tax advantage.