Taxation (International and Other Provisions) Act 2010 section 192A

Provision for cases within Part 6A

Section 192A ensures that where a guarantor company steps into the shoes of an issuing company whose tax deduction for a payment under a security has been reduced by transfer pricing rules, any hybrid mismatch provisions that would have applied to the issuing company will instead apply to the guarantor company.

• Where a deduction for a payment by an issuing company under a security is reduced under transfer pricing rules, a guarantor company may claim to be treated as if it had done what the issuing company did
• If hybrid mismatch rules (Part 6A) would have applied to the issuing company's tax treatment of that payment but for the transfer pricing reduction, those hybrid mismatch rules carry across to the guarantor company instead
• This prevents the guarantor company from gaining a tax advantage by avoiding hybrid mismatch consequences that the issuing company would otherwise have faced
• The provision only applies to the extent that all four conditions are met: there is a deductible amount, it is reduced by transfer pricing, the guarantor claims attribution, and hybrid mismatch rules would otherwise have applied to the issuing company