Corporation Tax Act 2010

27 Attribution to persons of rights and powers of their partners

(1) This section applies if it is necessary to determine in accordance with section 25(4) and (5) whether a company is an associated company of another company (“the taxpayer company”).

(2) In the application of section 451 (meaning of “control”: rights to be attributed) for the purposes of the determination, the references in section 451(4) and (5) to an associate of a person (“P”) include a partner of the person only if the condition in subsection (3) below is met.

(3) The condition is that tax planning arrangements which—

(a) involve P and the partner, and

(b) secure a relevant tax advantage,

have at any time had effect in relation to the taxpayer company.

(4) In subsection (3) “relevant tax advantage” means a reduction in the taxpayer company’s liability to corporation tax as a result of an increase in relief under this Part.

(5) The reference in subsection (3) to arrangements which have had effect in relation to the taxpayer company includes arrangements which have had effect in connection with the formation of the company.

(6) In this section “arrangements”—

(a) does not include any guarantee, security or charge given to or taken by a bank, but

(b) otherwise includes any agreement, understanding, scheme, transaction or series of transactions (whether or not legally enforceable).