In certain specialised situations involving securities, the disadvantaged company can elect to meet the tax liability of the advantaged person on the transfer pricing adjustment (TIOPA 2010, s. 199–204).

An election to pay the extra tax may be made in the case of a security if:

(1)both of the affected persons are companies;

(2)the actual provision confers a potential advantage in relation to UK tax on one of the affected persons (the ‘advantaged person’);

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