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HMRC internal manual

Company Taxation Manual

Close companies: extended meaning of distribution: payments to participators

The extended meaning of distribution CTM60520 should be regarded as applicable to money benefits (for example, gifts of money) for participators and their associates, which are not made good to the company.

It should also be applied to benefits in kind, in so far as such payments are not already distributions within CTM15100 onwards. But the application of the extended meaning may be precluded by CTM60600 (directors and employees), CTM60610 (groups of companies), CTM36130 (distributions in a winding-up), or CTM09060 (covenanted donation to a charity).