CA23194 - PMA: FYA: First-year tax credits: artificially inflated claims
CAA01/Sch.A1 para 28
There is anti-avoidance legislation intended to prevent a company making an artificially inflated claim for first-year tax credits. If a transaction is attributable to arrangements entered into wholly or mainly for a disqualifying purpose, disregard it when you work out the first-year credit to which a company is entitled.
Arrangements are entered into for a disqualifying purpose if their main object, or one of their main objects, is to let a company get a first-year tax credit
- to which it would not otherwise be entitled, or
- which is larger than the one to which it would otherwise be entitled.
“Arrangements” include any scheme, agreement or understanding, whether or not legally enforceable.