Corporation Tax Act 2010 section 715

Meaning of "transaction entered into in connection with change in ownership"

Section 715 defines what it means for a transaction to be "entered into in connection with a change in ownership" for the purposes of the expectation condition in section 714, which deals with the recovery of unpaid corporation tax following a change in company ownership.

• A transaction is connected with a change in ownership of a company (Y) if it is the transaction (or one of the transactions) that actually brings about the change, or if it forms part of a wider series of transactions or scheme that includes the change
• A "scheme" is defined very broadly to include any scheme, arrangements or understanding of any kind, whether or not legally enforceable and regardless of how many transactions are involved
• The parties to each transaction in a series or scheme do not need to be the same — different people or entities can be involved in each step and the transactions can still be treated as connected
• Two or more transactions are treated as forming part of a series or scheme if it would be reasonable to assume that one or more of them would not have been entered into independently of the others, or would not have taken the same form or been on the same terms if carried out independently