Section 459 | Charities

(1)This section applies where—

(a)apart from this section, an amount would be a tax-interest expense amount of a company as a result of meeting condition A in section 382 (loan relationship debits),

(b)the creditor is a charity,

(c)the company is a wholly-owned subsidiary of the charity, and

(d)the charitable gift condition is met at all times during the accounting period in which the amount is (or apart from this Part would be) brought into account.

(2)The amount is treated as not being a tax-interest expense amount of the company.

(3)For the purposes of this section the “charitable gift condition” is met at any time at which, were the company to make a donation to the charity at that time, it would be a qualifying charitable donation (see section 190 of CTA 2010).

(4)In this section—

“charity” has the same meaning as in Chapter 2 of Part 6 of CTA 2010 (see section 202 of that Act as read with Schedule 6 to FA 2010), and

“the creditor” means the person who is party to the loan relationship in question as creditor.