Corporation Tax Act 2009 section 455B

Counteracting effect of avoidance arrangements

Section 455B introduces an anti-avoidance rule that allows HMRC to counteract tax advantages arising from loan relationship avoidance arrangements by making fair adjustments to the credits and debits brought into account under Part 5 of the Act.

• Any loan-related tax advantages obtained through avoidance arrangements must be counteracted through just and reasonable adjustments to credits and debits under the loan relationships rules
• Adjustments can be made by HMRC or the company itself, using a range of mechanisms including assessments, modifications of assessments, amendments or disallowances of claims
• The key terms "relevant avoidance arrangements" and "loan-related tax advantage" are defined separately in section 455C
• The rule applies broadly to any arrangement designed to secure a tax advantage through the loan relationships regime, ensuring that the intended tax benefit is neutralised