BIM38200 - Wholly and exclusively: companies: contents
S54 Corporation Tax Act 2009
Introduction and layout of guidance
In corporate cases it is important that you establish the company바카라 사이트™s purpose in making a particular expenditure. A company바카라 사이트™s purpose is that of its directors or shareholders (as expressed in Annual General Meeting) See BIM37055 ²¹²Ô»åÌýBIM38210.
Where the payment concerns a subsidiary or associated company there are three possibilities:
- the company is providing such assistance solely in the interests of the subsidiary/associate
- the company is providing such assistance partly in the interests of the subsidiary/associate and partly in its own interests, and
- the company is providing such assistance solely in its own interests
In situations (a) and (b) the relevant expenditure is not deductible. In (c) a deduction is permissible and (applying Bentleys, Stokes & Lowless v Beeson [1952] 33 TC 491, see BIM37400) notwithstanding the fact that the subsidiary/associate receives an incidental benefit. The relevant question is 바카라 사이트˜what was the object of the person making the disbursement in making it?바카라 사이트™ not 바카라 사이트˜what was the effect of the disbursement when made?바카라 사이트™.
The guidance on companies covers the following matters:
Note that for companies chargeable to Corporation Tax, the tax treatment of loans and advances is governed exclusively by the loan relationships regime in Parts 5 and 6 Corporation Tax Act 2009. Detailed guidance is at CFM30000.