INTM556060 - Hybrids: multinational payee (Chapter 8): conditions to be satisfied: condition D

Condition D of s259HA asks whether it is reasonable to suppose that, if certain chapters of Part 6A (or equivalent non-UK legislation) did not apply, there would be a multinational payee deduction/non-inclusion mismatch in relation to the payment or quasi-payment.

The test is whether a relevant deduction/non-inclusion mismatch would arise if Chapters 8 to 10 of Part 6A (or any equivalent non-UK legislation) did not apply.

There is no definition of the term ‘reasonable to suppose’ in Part 6A, so the phrase will take its ordinary meaning. Generally, this does not require either party to know how the transaction has been treated by the counterparty: it requires only that, given the facts and circumstances, it is reasonable to conclude that a mismatch would arise in these circumstances.

See INTM556080 for the requirements for a deduction/non-inclusion mismatch to be a multinational payee deduction/non-inclusion mismatch.