Corporation Tax Act 2009

Other rules

850 Part realisation involving related party acquisition: exclusion of roll-over relief

(1) Chapter 7 (roll-over relief in case of realisation and reinvestment) does not apply in relation to the part realisation by a company of an intangible fixed asset if there is a related party acquisition as a result of, or in connection with, the part realisation.

(2) For this purpose there is a related party acquisition if a person who is a related party in relation to the company acquires an interest of any description—

(a) in the intangible fixed asset, or

(b) in an asset whose value is derived in whole or in part from that asset.

851 Delayed payment of royalty by company to related party

(1) This section applies if—

(a) a royalty is payable by a company to or for the benefit of a related party,

(b) the royalty is not paid in full within the period of 12 months after the end of the period of account in which a debit in respect of it is recognised by the company for accounting purposes, and

(c) credits representing the full amount of the royalty are not brought into account under this Part in any accounting period by the person to whom it is payable.

(2) The royalty is brought into account for the purposes of this Part only when it is paid.