CTM08238 | Corporation Tax: management expenses: targeted anti-avoidance rule (TAAR) - tax advantage
From HM Revenue & Customs · Company Taxation Manual
Most schemes to which applies are likely to be cases where a deduction for expenses of management is either created or inflated. But the rule also applies where any tax advantage is secured. The definition of tax advantage is taken from and is wide-ranging:
(1) This section has effect for the purposes of the provisions of the Corporation Tax Acts which apply this section;
(2) “Tax advantage” means—
(a) a relief from tax or increased relief from tax,
(b) a repayment of tax or increased repayment of tax,
(c) the avoidance or reduction of a charge to tax or an assessment to tax,
(d) the avoidance of a possible assessment to tax,
(da) the avoidance or reduction of a charge or assessment to a charge under (controlled foreign companies),
(e) the avoidance or reduction of a charge or assessment to the bank levy under (the bank levy)
(f) the avoidance or reduction of a charge to diverted profits tax.
(3) For the purposes of and (d) it does not matter whether the avoidance or reduction is effected—
(a) by receipts accruing in such a way that the recipient does not pay or bear tax on them, or
(b) by a deduction in calculating profits or gains.
(3A) The avoidance or reduction of a charge or assessment to the bank levy as a result of arrangements to which any of FA11/SCH19/PARA47 (7) to (12) any of apply.
(4) In this section “relief from tax” includes—
(a) a tax credit under for the purposes of corporation tax, and
(b) a tax credit under ITTOIA05/S397 (1) or S397A (1) for the purposes of income tax.
The definition covers relief, repayments, the amount of a charge, and the assessment of Corporation Tax.