Corporation Tax Act 2009 section 411

Interpretation of section 409

Section 411 provides the definitions and interpretive rules needed to apply section 409, which postpones loan relationship debits on deeply discounted securities issued by close companies until the securities are redeemed.

• A "participator" in a company means someone who has an ownership or economic interest in it (as defined by section 454 of CTA 2010), but does not include a person who qualifies solely because they are a loan creditor of the company.
• If a person is a participator in a parent company that controls a subsidiary, that person is also treated as a participator in the subsidiary for the purposes of section 409.
• "Control" takes its meaning from section 472 of CTA 2009, which broadly looks at whether a person holds the greater part of a company's share capital, voting power, or rights to income or assets.
• Where a bank acquires securities of a company in the ordinary course of its banking business, those securities are disregarded when deciding whether the bank is a participator in that company.