Schedules
Schedule 4Investment vehicles
Part 3Qualifying asset holding companies
15Alternative finance arrangements
1
After paragraph 58 insert—
59Alternative finance arrangements
1
Sub-paragraph (2) applies for the purposes of determining the amounts of relevant interests in companies in accordance with paragraphs 3 to 6 and the provisions of Chapter 6 of Part 6 of CTA 2010 applied by those paragraphs.
2
Where a person has (in substance) a beneficial entitlement to the profits of a company as a result of qualifying alternative finance arrangements—
a
that entitlement is to be treated as an entitlement to a proportion of the profits of that company available for distribution to equity holders of the company, and
b
that person is to be treated as an equity holder.
3
“Qualifying alternative finance arrangements” means arrangements—
a
that constitute alternative finance arrangements for the purposes of Chapter 6 of Part 6 of CTA 2009 (alternative finance arrangements), or
b
that do not constitute alternative finance arrangements only as a result of section 508 of that Act (exclusion provision not at arms length).
4
But arrangements that are analogous to a normal commercial loan are not qualifying alternative finance arrangements.
5
Arrangements are analogous to a normal commercial loan if, were the arrangements structured as a loan that resulted in the same or similar entitlements of the parties to the arrangements, they would constitute a normal commercial loan within the meaning of section 162 of CTA 2010.
2
In paragraph 3, after sub-paragraph (5) insert—
5A
See also paragraph 59, which makes provision for parties to alternative finance arrangements who are equivalent to equity holders to be treated as such.
3
In paragraph 58(1), in the definition of “equity holder” at the end insert “, but see also paragraph 59 of this Schedule”
.