Corporation Tax Act 2009

1112 Artificially inflated claims for relief or tax credit

(1) To the extent that a transaction is attributable to arrangements entered into wholly or mainly for a disqualifying purpose, it is to be disregarded for the purposes mentioned in subsection (2).

(2) Those purposes are—

(a) determining for an accounting period relief to which a company is entitled under this Chapter, and

(b) determining for an accounting period R&D tax credits to which a company is entitled under this Chapter.

(3) Arrangements are entered into wholly or mainly for a “disqualifying purpose” if their main object, or one of their main objects, is to enable a company to obtain—

(a) relief under this Chapter to which it would not otherwise be entitled,

(b) relief under this Chapter of a greater amount than that to which it would otherwise be entitled,

(c) an R&D tax credit under this Chapter to which it would not otherwise be entitled, or

(d) an R&D tax credit under this Chapter of a greater amount than that to which it would otherwise be entitled.

(4) In this section “arrangements” includes any scheme, agreement or understanding, whether or not legally enforceable.