Income Tax Act 2007 section 809BZN

Exceptions

Section 809BZN sets out the circumstances in which the finance arrangement anti-avoidance rules do not apply, providing a series of exceptions where existing tax provisions already deal adequately with the transaction.

• The finance arrangement rules do not apply where the full amount of the advance is already taxed as income of a relevant person, brought into account as income for tax purposes, or treated as a disposal receipt or balancing event proceeds under the capital allowances legislation.
• The rules are also disapplied where the advance constitutes (or would constitute, if the person were a company within the charge to corporation tax) a debtor relationship under the loan relationships regime, excluding relevant non-lending relationships.
• Arrangements already covered by other specific tax regimes — including sale and repurchase of securities (repos), alternative finance arrangements, sale and finance leasebacks of plant or machinery, and the finance leaseback provisions in capital allowances legislation — are excluded from the finance arrangement rules.
• Right-of-use leases where the relevant person is the lessee are excluded, provided that, if the person were required under generally accepted accounting practice to classify the lease, it would not be treated as a finance lease or loan in their accounts.