PART 2

Insurance companies carrying on long-term business
CHAPTER 10

Transfers of long-term business

Transfers of long-term business: anti-avoidance

Anti-avoidance
132
1
This section applies if—
a
under an insurance business transfer scheme, there is a transfer on or after 1 January 2013 from one insurance company to another of basic life assurance and general annuity business (or any part of that business) or non-BLAGAB long-term business (or any part of that business), and
b
the main purpose, or one of the main purposes, of a company (“C”) in entering into one or more of the arrangements included in the insurance business transfer arrangements is an unallowable purpose.
2
The “insurance business transfer arrangements” consist of—
a
the insurance business transfer scheme under which the transfer is made, and
b
any arrangement entered into on or after 1 January 2013 with a connection (direct or indirect) to that scheme.
3
A purpose is an “unallowable purpose” if—
a
it consists of securing a tax advantage for C or any other company, or
b
it is not amongst C's business or other commercial purposes.
4
There are to be made such adjustments of any income or gains chargeable to corporation tax as are required to negate any tax advantage arising to C or any other company so far as referable to the unallowable purpose on a just and reasonable apportionment.
5
For the purposes of this section—
a
“arrangement” includes any agreement, scheme, transaction or understanding (whether or not legally enforceable), and
b
section 1139 of CTA 2010 (meaning of “tax advantage”) applies, but reading references to tax as references to corporation tax.
6
If C is not within the charge to corporation tax in respect of a part of its activities, C's business or other commercial purposes for the purposes of this section do not include the purposes of that part of its activities.