Taxation (International and Other Provisions) Act 2010 section 466

Certain loan relationships etc. to be treated as made between related parties

Section 466 sets out additional circumstances in which two parties who are not otherwise related must be treated as related parties for the purposes of specific loan relationships or financial transactions.

• Where a related party of the debtor provides a guarantee, indemnity, or other financial assistance in respect of a loan, the debtor and creditor are treated as related parties for that loan.
• Where a related party of the debtor indirectly stands in the position of creditor through a chain of loans or other arrangements, the debtor and creditor are treated as related parties for that loan.
• These rules apply not only to loan relationships but also to any other financial liability owed to, or transaction with, the creditor.
• The deemed related party treatment under the guarantee rule is subject to specific exceptions for qualifying net group-interest expense (section 415) and public infrastructure interest payable to third parties (section 438(3)).