Corporation Tax Act 2009

Matters to be ignored

864 Tax avoidance arrangements to be ignored

(1) In determining whether a credit or a debit is to be brought into account under this Part and, if so, its amount, any tax avoidance arrangements are ignored.

(2) Arrangements are “tax avoidance arrangements” for this purpose if their main object or one of their main objects is to enable a company—

(a) to obtain a debit under this Part to which it would not otherwise be entitled,

(b) to obtain a debit under this Part which exceeds that to which it would otherwise be entitled,

(c) to avoid having to bring a credit into account under this Part, or

(d) to reduce the amount of any such credit.

(3) In this section—

• “arrangements” includes any scheme, agreement or understanding, whether or not it is legally enforceable, and

• “brought into account” means brought into account for tax purposes.

865 Debits for expenditure not generally deductible for tax purposes

(1) No debit may be brought into account for tax purposes under this Part in respect of expenditure that is not generally deductible for tax purposes.

(2) Expenditure is “not generally deductible for tax purposes” so far as revenue expenditure of that description incurred for the purposes of a trade would be non-deductible because of a provision specified in subsection (3).

(3) Those provisions are—

(a) section 56 (car or motor cycle hire),

(b) section 1298 (business entertainment and gifts),

(c) section 1304 (crime-related payments), and

(d) section 246(2) of FA 2004 (expenditure on benefits under employer-financed retirement benefits schemes).