195Qualifying conditions for purposes of section 196U.K.
(1)Conditions A to D are “the qualifying conditions” for the purposes of section 196.
(2)Condition A is that only one of the affected persons (“the advantaged person”) is a person on whom a potential advantage in relation to United Kingdom taxation is conferred by the actual provision.
(3)Condition B is that the other affected person (“the disadvantaged person”) is within the charge to income tax or corporation tax in respect of profits arising from the relevant activities (see section 216).
(4)Condition C is that—
(a)a payment (the “balancing payment”) is made, or
(b)two or more payments (the “balancing payments”) are made,
to the advantaged person by the disadvantaged person.
(5)Condition D is that the sole or main reason for making that payment or those payments is that section 147(3) or (5) applies.