CFM77530 - Other tax rules on corporate debt: group mismatch schemes: the conditions
CTA10/S938B defines a Group Mismatch Scheme (GMS). A scheme is a GMS if the parties to it are, or include, members of the same group (referred to as 바카라 사이트榯he scheme group바카라 사이트�) and either condition A or B is met.
Condition A
Condition A is that, at the time the scheme is entered into, there is no practical likelihood that the scheme will fail to secure a relevant tax advantage (CFM77580) of 拢2million or more.
바카라 사이트楴o practical likelihood바카라 사이트� is not defined, and will take its everyday meaning taking into account all of the facts. However, a condition put in purely to attempt to avoid the 바카라 사이트渘o practical likelihood바카라 사이트� test will not be effective, following the judgment in the House of Lords in Scottish Provident Institution 76 TC 538. In that case, it was ruled that an avoidance scheme did not work, even though the parties had 바카라 사이트渄eliberately included a commercially irrelevant congency, creating an acceptable risk that the scheme might not work as planned.바카라 사이트�
Condition B
Condition B is that the purpose, or one of the main purposes, of any member of the scheme group entering into the scheme is to obtain the chance of securing a relevant tax advantage (of any amount) and at the time the scheme is entered into there is no chance that the scheme will secure a relevant tax disadvantage or, if there is such a chance, the expected value of the scheme is still a positive amount.
Condition B, unlike condition A looks at the purpose of the companies in being party to the arrangements. Again, this is a question of fact.
See CFM38120 onwards for guidance what factors should be taken into account in determining a company바카라 사이트檚 purpose.
Further guidance on how to establish purpose and the distinction between purpose and motive can also be found in the Business Income Manual at BIM37050 onwards.