Part 6Relationships treated as loan relationships etc

Chapter 6Alternative finance arrangements

Treatment for other tax purposes

520Provision not at arm's length: non-deductibility of relevant return

(1)

This section applies if arrangements to which section 508 (provision not at arm's length: exclusion of arrangements from sections 503 to 507) applies would, but for that section, be alternative finance arrangements.

(2)

A company paying relevant return under the arrangements is not entitled to—

(a)

any deduction in calculating profits or gains for corporation tax purposes, or

(b)

any deduction F1from total profits,

in respect of the relevant return.

(3)

In this section “relevant return” has the same meaning as in section 508 (see subsection (3) of that section).