Section 182
Section 182: treating connected persons and accommodating parties under GAAR
Section 182 gives the tax authorities tools to see through an arrangement's formal structure when checking whether a tax benefit exists under GAAR - by treating connected persons as one, disregarding accommodating parties, and looking through corporate structures.
What Section 182 allows
In determining whether a tax benefit exists under Chapter XI, the following may be done:
- parties who are connected persons in relation to each other may be treated as one and the same person;
- any accommodating party may be disregarded;
- the accommodating party and any other party may be treated as one and the same person;
- the arrangement may be considered or looked through by disregarding any corporate structure.
Frequently asked questions
Can the tax department ignore an accommodating party in an arrangement?
Yes - under Section 182, in determining whether a tax benefit exists, an accommodating party may be disregarded, or treated as the same person as another party to the arrangement.
Can a corporate structure be disregarded when checking for a tax benefit?
Yes - Section 182(d) allows the arrangement to be considered or looked through by disregarding any corporate structure.
Related sections
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