Corporation Tax Act 2009 (c. 4)

Part 8 U.K. Intangible fixed assets

Chapter 13 U.K. Transactions between related parties

Transfers treated as being at market value U.K.

845 Transfer between company and related party treated as at market value U.K.

(1) The basic rule is that a transfer of an intangible asset—

(a) from a company to a related party, or

(b) to a company from a related party,

is treated for all purposes of the Taxes Acts as being at market value (as respects both the company and the related party) if condition A or B is met.

(2) Condition A is that the asset is a chargeable intangible asset in relation to the transferor immediately before the transfer.

(3) Condition B is that the asset is a chargeable intangible asset in relation to the transferee immediately after the transfer.

(4) That rule is subject to—

(a) section 846 (transfers not at arm's length),

(b) section 847 (transfers involving other taxes),

(c) section 848 (tax-neutral transfers), and

(d) section 849 (transfers involving gifts of business assets).

(5) In subsection (1)—

• “market value” means the price the asset might reasonably be expected to fetch on a sale in the open market, and

• “the Taxes Acts” means the enactments relating to income tax, corporation tax or chargeable gains.