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HMRC internal manual

Corporate Finance Manual

Other tax rules on corporate finance: structured finance: overview

When the new rules have effect

FA06/SCH6 introduced provisions to stop a number of schemes which are intended to enable taxpayers (companies and individuals) to borrow money and obtain effective tax relief for both interest and repayment of principal. These schemes are described in this guidance as structured finance arrangements (SFAs). The legislation is at CTA10/Part 16.

The schemes are similar to those that were countered by the rent factoring legislation in ICTA88/S43A to S43G (CTM36610), but the legislative remedy adopted is somewhat different and extends far wider than the rent factoring rules. The new legislation allowed those rules to be repealed.

The new rules apply to income arising on or after 6 June 2006.

CFM73020 onwards describes some of the structured finance arrangements at which the new rules are aimed.

CFM73050 gives definitions of terms used in the legislation.

CFM73060 describes the new rules as they apply in straightforward cases.

CFM73170 describes the new rules as they apply in more complex partnership scenarios.

CFM73250 sets out the exceptions to the structured finance rules.

CFM73290 describes the transitional rules which apply where arrangements begin to be subject to these provisions.

CFM73300 describes the CGT exemption for assets disposed of under SFAs.