Assets treated as pre-FA 2002 assetsU.K.
892Certain assets acquired on transfer of business [F1or transfer within a group]U.K.
(1)This section applies if—
(a)a company (“the transferor”) transfers to another company (“the transferee”) an asset that is a pre-FA 2002 asset in the hands of the transferor company,
(b)the transfer is one in relation to which the transferor is treated for the purposes of TCGA 1992 as disposing of the asset for a consideration that secures that neither a gain nor a loss accrues to it, and
(c)it is so treated because of a provision specified in subsection (2).
(2)The provisions are—
(a)section 139 of TCGA 1992 (reconstruction involving transfer of business),
(b)section 140A of that Act (transfer or division of UK business), F2...
(c)section 140E of that Act (merger leaving assets within UK tax charge)[F3, and
(d)section 171 of that Act (transfers within a group)].
(3)In the hands of the transferee the asset is treated for the purposes of this Part as a pre-FA 2002 asset.
(4)This section does not apply if the transfer mentioned in subsection (1) occurred before 28 June 2002.
[F4(5)If the transfer mentioned in subsection (1) occurred before 1 July 2020, this section applies as if paragraph (d) of subsection (2) were omitted.]
Textual Amendments
F1Words in s. 892 heading inserted (with effect in accordance with s. 31(14)(15) of the amending Act) by Finance Act 2020 (c. 14), s. 31(10)(a)
F2Word in s. 892(2)(b) omitted (with effect in accordance with s. 31(14)(15) of the amending Act) by virtue of Finance Act 2020 (c. 14), s. 31(10)(b)
F3S. 892(2)(d) and word inserted (with effect in accordance with s. 31(14)(15) of the amending Act) by Finance Act 2020 (c. 14), s. 31(10)(c)
F4S. 892(5) inserted (with effect in accordance with s. 31(14)(15) of the amending Act) by Finance Act 2020 (c. 14), s. 31(10)(d)
893Assets whose value derives from pre-FA 2002 assetsU.K.
(1)This section applies if—
(a)[F5during the period beginning with 1 April 2002 and ending with 30 June 2020] a company (“the acquiring company”) acquires an intangible fixed asset (“the acquired asset”) from a person (“the transferor”),
(b)the acquired asset is created on or after 1 April 2002,
(c)at the time of the acquisition the transferor and the acquiring company are related parties,
(d)the value of the acquired asset derives in whole or in part from any other asset (“the other asset”), and
(e)the other asset meets the preserved status conditions (see section 894).
(2)In the hands of the acquiring company the acquired asset is treated for the purposes of this Part as a pre-FA 2002 asset so far as its value derives from the other asset.
(3)If only part of the value of the acquired asset derives from the other asset—
(a)this Part applies as if there were a separate asset representing the part of the value that does not so derive, and
(b)the alternative enactments apply as if there were a separate asset representing the part of the value that does so derive.
(4)In subsection (3) “the alternative enactments” means the enactments that apply where this Part does not apply.
(5)For the purposes of this section the cases in which the value of an asset may be derived from any other asset include any case where—
(a)assets have been merged or divided,
(b)assets have changed their nature, or
(c)rights or interests in or over assets have been created or extinguished.
(6)Section 894 supplements this section.
Textual Amendments
F5Words in s. 893(1)(a substituted (with effect in accordance with s. 31(14)(15) of the amending Act) by Finance Act 2020 (c. 14), s. 31(11)
894The preserved status conditions etcU.K.
(1)For the purposes of section 893(1) the other asset meets the preserved status conditions if subsections (2) and (3) apply.
(2)This subsection applies if on or after 1 April 2002 the other asset—
(a)has been a pre-FA 2002 asset in the hands of the transferor at a time when the transferor and the acquiring company were related parties, or
(b)has been a pre-FA 2002 asset in the hands of any other person at a time when—
(i)the other person and the acquiring company were related parties, or
(ii)the other person and the transferor were related parties.
(3)This subsection applies if the other asset has not at any time on or after 5 December 2005 been a chargeable intangible asset in the hands of—
(a)the acquiring company,
(b)a person who is a related party in relation to that company, or
(c)the transferor.
(4)It does not matter for the purposes of section 893(1)(b) who created the acquired asset.
(5)Any apportionment necessary for the purposes of section 893(3) must be made on a just and reasonable basis.
(6)Sections 883 to 889 (provisions explaining when assets are treated as created or acquired) apply for the purposes of section 893 as they apply for the purposes of section 882.
[F6(6A)Section 882(5A) to (5D) applies for the purposes of section 893 and this section.]
(7)Expressions used in this section have the same meaning as in section 893.
Textual Amendments
F6S. 894(6A) inserted (with effect in accordance with s. 52(5) of the amending Act) by Finance Act 2016 (c. 24), s. 52(3)
895Assets acquired in connection with disposals of pre-FA 2002 assetsU.K.
(1)This section applies if—
(a)a person disposes of an asset which is a pre-FA 2002 asset in the person's hands at the time of the disposal,
(b)[F7at any time before 1 July 2020] a company acquires an intangible fixed asset directly or indirectly in consequence of the disposal or otherwise in connection with it,
(c)the company and the person are related parties at the time of the disposal, and
(d)the acquired asset would be a chargeable intangible asset in the hands of the company at the time of the acquisition apart from this section.
(2)The acquired asset is treated for the purposes of this Part as a pre-FA 2002 asset in the company's hands.
(3)For the purposes of this section—
(a)“asset”, in relation to any disposal, means any asset for the purposes of TCGA 1992,
(b)a person “disposes of” an asset if, for the purposes of that Act, the person makes a part disposal of the asset or any other disposal of it, and
(c)the time at which a disposal of an asset is made is the time at which it is made for the purposes of that Act.
(4)For the purposes of this section it does not matter whether—
(a)the asset that the person disposes of is the same asset as the acquired asset,
(b)the acquired asset is acquired at the time of the disposal, or
(c)the acquired asset is acquired by merging assets or otherwise.
[F8(5)Section 882(5A) to (5D) applies for the purposes of this section.]
Textual Amendments
F7Words in s. 895(1)(b) inserted (with effect in accordance with s. 31(14)(15) of the amending Act) by Finance Act 2020 (c. 14), s. 31(12)
F8S. 895(5) inserted (with effect in accordance with s. 52(5) of the amending Act) by Finance Act 2016 (c. 24), s. 52(4)