Taxation (International and Other Provisions) Act 2010 section 192

Attribution to guarantor company of things done by issuing company

Section 192 allows a guarantor company to claim a tax deduction for interest that was disallowed in the hands of the issuing company under transfer pricing rules, by treating the guarantor as if it had issued the security itself.

• On making a claim, the guarantor company is treated for tax purposes as if it had issued the security, owed the liabilities under it, and paid any interest or other amounts paid by the issuing company — but only to the extent of the transfer pricing reduction.
• Where there are multiple guarantees over the same security, the total amounts claimed by all guarantor companies must not exceed the total transfer pricing reductions applied to the issuing company's interest.
• The term "guarantee" is broadly defined to include sureties and any other formal or informal arrangements where the lender has a reasonable expectation of being paid by another company if the issuing company defaults.
• Further rules on how claims under this section interact with claims under section 174, and general provisions about making such claims, are set out in sections 193 and 194.