For updates affecting this Division please see Part D0 Updates
Tax treatment of manufactured dividends and interest
D9.701 Manufactured payments—overview
Manufactured payments are, broadly, payments representative of UK dividends, interest or overseas dividends paid under contracts or other arrangements for the transfer of securities.
The strict definition of manufactured payments for companies and individuals is detailed below, together with a summary of typical transactions that will fall within the manufactured payments regime.
Companies
A manufactured dividend relationship for corporation tax purposes exists where all the following conditions are met1:
- Ìý
•ÌýÌýÌýÌý under any arrangements an amount is payable by or to the company, or any other benefit is given by or to the company (including the release of the whole or part of any liability to pay an amount). This is referred to as the 'manufactured dividend'
- Ìý
•ÌýÌýÌýÌý the arrangements relate to the transfer of shares in a company
- Ìý
•ÌýÌýÌýÌý the amount or value of the other benefit is representative of a 'real' dividend on the shares, or will fall
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