Income Tax (Earnings and Pensions) Act 2003 section 554AF

Section 554AA: supplementary

Section 554AF provides supplementary rules that govern how the close companies gateway in section 554AA operates, including exceptions after death, the extended meaning of the individual concerned, and the approach to determining whether an arrangement exists.

• The close companies gateway in section 554AA is subject to the general exclusions in sections 554E to 554Y, which may disapply the disguised remuneration rules in certain circumstances.
• After the death of the individual (A), Chapter 2 does not apply under the close companies gateway where the relevant step involves earmarking a sum or asset (section 554B) or making a payment or transfer under section 554C(1)(ab).
• References to the individual (A) in section 554AA extend to persons linked with A, broadening the scope of who can trigger the close companies gateway.
• An arrangement can fall within section 554AA even if it lacks specific details such as the amounts involved, the timing, or the identity of the parties — what matters is the essence of the arrangement, assessed by considering all relevant circumstances.