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HMRC internal manual

Corporate Finance Manual

Other tax rules on corporate finance: securitisation: periods beginning on or after 1 January 2005: the interim regime: other types of securitisation company

Other types of securitisation company

Asset-holding company

As for the note-issuing company (CFM72230), the definition of an asset-holding company is the same as that in the permanent regime, except that it is not restricted to ‘financial assets’. That is

  • its business, apart from incidental activities, must consist of acquiring, holding and managing the assets that form the security for the debt instruments issued by the note-issuing company, and
  • its liabilities as debtor relationships (under the loan relationships legislation), are owed wholly or mainly, to the note-issuing company or an intermediate borrowing company.

In the interim regime, the permitted assets may therefore include whole business and real property interests.

As in the case of the permanent regime, the existence of subordinated debt (CFM72430) will not lead to the asset-holding company failing the second condition.

Intermediate borrowing company, warehouse company, commercial paper funded company

The definitions are again very close to those in the permanent regime.

As for the note-issuing company, the guidance at CFM72440 onwards can be taken as applying in interpreting the definitions of these types of securitisation company.