CTM61515 - Close companies: loans to participators and arrangements conferring benefit on participator: meaning of 鈥榬elevant person鈥�
CTA10/S455 (6)
The meaning of 鈥榬elevant person鈥� is defined in CTA10/S455 (6) as:
- an individual, or
- a company which is acting in a fiduciary or representative capacity
The singular term 鈥榠ndividual鈥� also encompasses 鈥榠ndividuals鈥�, (Section 6 Interpretation Act 1978). Equally 鈥榬elevant person鈥� will also encompass 鈥榬elevant persons鈥�. 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.