EIM11910 - PAYE: meaning of readily convertible assets: trading arrangements: definition

Section 702 ITEPA 2003

Trading arrangements for any asset provided to any person exist whenever there exist any arrangements the effect of which in relation to that asset is to enable either:
- that person, or - a member of that person’s family or household

to obtain an amount or total amount of money that is, or is likely to be, similar to the expense incurred in the provision of that asset.
### Arrangements

The word arrangements is not defined. Therefore it must take its ordinary meaning within the context of the legislation. Broadly, this is anything relating to the asset allowing something to be done in respect of the asset.
### Enabling a person to obtain an amount of money

When considering whether trading arrangements exist, the reference to enabling a person to obtain an amount of money is construed widely. The amount may be obtained by any means at all but particular examples include:
- using the asset as security for a loan or advance - using any rights comprised in or attached to the asset to obtain another asset for which trading arrangements exist.

Enabling a person to obtain an amount of money also includes references to cases where a person may obtain an amount as a member of a class or description of persons as well as being enabled in his or her own right.
### Amount similar to the expense incurred

An amount is similar to the expense incurred in the provision of any asset if it is an amount of money either:
- equal to the expense incurred, or - greater than the expense incurred, or - not substantially less than the expense incurred.

Meaning of money

In this context, money includes money expressed in a currency other than sterling.