Impermissible avoidance arrangements permit denial of tax benefits and broad recharacterisation, reallocation, and look-through tax adjustments.

Impermissible avoidance arrangements may trigger tax consequences designed to neutralise the tax effect of the arrangement, including denial of a tax benefit or treaty benefit. The anti-avoidance framework allows disregard, combination, or recharacterisation of steps or the whole arrangement, treatment of the arrangement as not entered into, disregard of accommodating parties, deeming of connected persons as one person, reallocation of accruals, receipts, expenditure, deductions, reliefs, or rebates, reassessment of residence or situs, and looking through corporate structures. It also permits equity-debt and capital-revenue recharacterisation.

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