Commentary

D6.460 Company purchase schemes—overview

Corporate tax
Corporate tax | Commentary

D6.460 Company purchase schemes—overview

Corporate tax | Commentary

Anti-avoidance—Company purchase schemes

D6.460 Company purchase schemes—overview

Specific legislation targets company purchase schemes (ie schemes whereby a company is sold when it would be impossible for the company to meet its tax debts).

Where the necessary conditions are met, the legislation enables HMRC to collect any unpaid tax from persons who previously controlled the company or other companies under their control1. The legislation is intended to counter schemes that were structured as follows:

  1.  

    (a)     A company transfers its business and assets to an associated company, retaining only enough cash to meet its corporation tax liability: the company is then

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