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HMRC internal manual

Company Taxation Manual

Close companies: loans to participators and arrangements conferring benefit on participator: meaning of ‘relevant person’

CTA10/S455 (6)

The meaning of ‘relevant person’ is defined in CTA10/S455 (6) as:

  • an individual, or
  • a company which is acting in a fiduciary or representative capacity

The singular term ‘individual’ also encompasses ‘individuals’, (Section 6 Interpretation Act 1978). Equally ‘relevant person’ will also encompass ‘relevant persons’. See CTM61520 for how this applies to partnerships and CTM61525 for how it applies to trustees (who are individuals).

Because a company acting in a fiduciary or representative capacity (e.g. a corporate trustee) is a relevant person, a loan to such a company which is a participator or an associate of a participator in the close company will be within the charge to tax under Section 455. See CTM61525 for further information on the application of the legislation to loans to trusts.