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In force since 2026-04-01, as the publisher states.
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Contains public sector information licensed under the Open Government Licence v3.0. Source: legislation.gov.uk, The National Archives.
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(1) Section 843 explains what is meant in this Chapter when a person is referred to as being connected with another person. (2) If that section provides that one person (“A”) is connected with another person (“B”), B is connected with A too. (3) In that section— “relative” means brother, sister, ancestor or lineal descendant, and “settlement” and “settlor” have the same meaning as in Chapter 5 of Part 5 of ITTOIA (see section 620 of that Act).
Propose a change(1) An individual (“A”) is connected with another individual (“B”) if— (a) A is B's spouse or civil partner, (b) A is a relative of B, (c) A is the spouse or civil partner of a relative of B, (d) A is a relative of B's spouse or civil partner, or (e) A is the spouse or civil partner of a relative of B's spouse or civil partner. (2) A person in the capacity of a trustee of a settlement is connected with— (a) any individual who is a settlor in relation to the settlement, (b) any person connected with such an individual, and (c) any body corporate that is connected with the settlement. (3) For the purposes of subsection (2) a body corporate is connected with a settlement if— (a) it is a close company (or not a close company only because it is not UK resident) and the participators include the trustees of the settlement, or (b) it is controlled by a company within paragraph (a). (4) A person is connected with a company if they are related parties because of section 835(2) or (3). (5) For the purposes of subsection (4) and for the purposes of section 835 as it applies for the purposes of subsection (4)— (a) “company” includes any body corporate or unincorporated association, but does not include a firm, and (b) a unit trust scheme is treated as if it were a company and as if the rights of the unit holders were shares in the company.
Propose a change(1) This Chapter sets out special rules relating to transactions between related parties. (2) Sections 845 to 849A are about the rule that transfers between a company and a related party are treated as being at market value. (2ZA) Sections 849AB to 849AD make provision for the grant of a licence or other right by a company to a related party, or vice versa, to be treated as being at market value. (2A) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (3) Sections 850 and 851 set out other rules for transactions involving related parties. (4) See Chapter 12 for the meaning of “related parties”.
Propose a change(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) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (b) section 847 (transfers involving other taxes), (c) section 848 (tax-neutral transfers), ... (ca) section 848A (assets held for purposes of exempt foreign permanent establishments), ... (d) section 849 (transfers involving gifts of business assets), ... (e) section 849A (disincorporation relief: transfer values for post-FA 2002 goodwill) , and (f) sections 900E and 900F (special rules in respect of assets that were pre-FA 2002 assets etc). (4ZA) But the basic rule does not apply in relation to a transfer if— (a) the transfer is a cross-border transfer, and (b) the transfer is subject to transfer pricing. (4ZB) See also section 846 for a different rule where— (a) the basic rule doesn’t apply as a result of subsection (4ZA), and (b) the profits and losses of the company or the related person are not required, under Part 4 of TIOPA 2010, to be calculated as if the arm’s length provision had been made instead of the provision comprising the transfer or of which the transfer forms part. (4ZC) Where, as a result of section 846 or Part 4 of TIOPA 2010, the profits and losses of the company or the related person are to be calculated as if the arm’s length provision had been made instead of the actual provision for the transfer, the transfer is treated for all purposes of the Taxes Acts as being for the price it would have under that arm’s length provision (as respects both the company and the related party). (4ZD) For the purposes of subsection (4ZA)(a) a transfer is a cross-border transfer if, at the time of the transfer, the related party is— (a) a UK resident company, but only if it has a qualifying permanent establishment in a territory outside the United Kingdom, (b) a non-UK resident company, other than a non-UK resident company that has a permanent establishment in the United Kingdom with a relevant connection to the transferred asset, (c) a non-UK resident individual, other than an individual that carries on a trade, profession or vocation in the United Kingdom through a branch or agency that has a relevant connection to the transferred asset, or (d) a partnership, but only if all of its members are non-UK resident or it has a qualifying permanent establishment in a territory outside the United Kingdom. (4ZE) Where the related party has a permanent establishment in a territory outside the United Kingdom, that permanent establishment is “qualifying” if— (a) exemption adjustments under section 18A(1) of CTA 2009 (exemption for profits or losses of foreign permanent establishments) would be made in calculating the taxable profits of the related party, and (b) those adjustments include adjustments in respect of the transferred asset. (4ZF) A permanent establishment of the related party in the United Kingdom has a relevant connection to the transferred asset if the asset is, in accordance with Chapter 4 of Part 2, attributable to that permanent establishment. (4ZG) A branch or agency of the related party has a relevant connection to the transferred asset if— (a) where the related party is the transferor, it was used or held for the purposes of the branch or agency immediately before the transfer, or (b) where the related party is the transferee, it was acquired for use by, to be held by or for the purposes of, the branch or agency. (4A) References in subsection (1) to a related party in relation to a company are to be read as including references to a person in circumstances where the participation condition is met as between that person and the company. (4B) References in subsection (4A) to a company include a firm in a case where, for section 1259 purposes, references in subsection (1) to a company are read as references to the firm. (4C) Section 148 of TIOPA 2010 (when the participation condition is met) applies for the purposes of subsection (4A) as it applies for the purposes of section 147(1)(b) of TIOPA 2010. (4D) Subsection (4E) applies where— (a) a gain on the disposal of an intangible asset by a firm is a gain to be taken into account for section 1259 purposes, and (b) for those purposes, references in subsection (1) to a company are read as references to the firm. (4E) Where this subsection applies, the gain referred to in subsection (4D)(a) is to be treated for the purposes of this section as if it were a chargeable realisation gain for the purposes of section 741(1) (meaning of “chargeable intangible asset”). (4F) In this section, “section 1259 purposes” means the purposes of determining under section 1259 the amount of profits or losses to be allocated to a partner in a firm. (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. (6) In this section “branch or agency”— (a) means any factorship, agency, receivership, branch or management, but (b) does not include any person within any of the exemptions under sections 835G to 835K of ITA 2007 (persons who are not UK representatives). (7) For the purposes of this section and section 846— “provision” and “arm’s length provision” are to be construed in accordance with Part 4 of TIOPA 2010 (transfer pricing); a transfer is “subject to transfer pricing” if— as a result of Part 4 of TIOPA 2010 (transfer pricing), the profits and losses of the company or the related party are to be calculated for tax purposes as if the arm's length provision to which those credits or debits would relate had been made or imposed instead of the actual provision to which they relate, or those profits would be so calculated if the actual provision — conferred a potential advantage in relation to United Kingdom taxation (within the meaning of that Part) on the company, and differed from the arm’s length provision.
Propose a change(1) This section applies to a person who is a company or related party to whom, or from whom, a transfer of an intangible fixed asset is made if— (a) the basic rule in section 845 would apply in relation to that person and that transfer but does not as a result of subsection (4ZA) of that section (provision subject to transfer pricing), and (b) the profits and losses of that person are not required, under section 147(3) or (5) of TIOPA 2010, to be calculated as if the arm’s length provision had been made instead of the provision comprising the transfer or of which the transfer forms part. (2) Section 147(3) of that Act applies to that person in relation to the provision comprising the transfer, or of which the transfer forms part, as if— (a) the reference to the “potentially advantaged person” were to that person, and (b) the reference to the “actual provision” were to the provision comprising the transfer or of which the transfer forms part. See also section 151(3) of that Act for provision about applying the arm’s length provision in relation to intangible fixed assets.
Propose a change(1) This section applies if— (a) in a case where section 845(1) applies and the asset is transferred from the company to a related party, the transfer is at less than its market value, (b) in a case where that section applies and the asset is transferred to the company from the related party, the transfer is at more than its market value, and (c) conditions A and B apply. (2) Condition A is that the related party— (a) is not a company, or (b) is a company in relation to which the asset is not a chargeable intangible asset immediately after the transfer to it or, as the case may be, immediately before the transfer from it. (3) Condition B is that the transfer— (a) gives rise to an amount to be taken into account in calculating any person's income, profits or losses for tax purposes because of a relevant provision, or (b) would do so apart from section 845(1). (4) If this section applies, section 845(1) does not apply in relation to the calculation referred to in subsection (3) for the purposes of any relevant provision. (5) In this section “relevant provision” means— (a) Chapter 2 of Part 23 of CTA 2010 (matters which are distributions), except section 1000(2), and (b) Part 3 of ITEPA 2003 (employment income: earnings and benefits etc treated as earnings).
Propose a change(1) Section 845 does not apply if the transfer is tax-neutral for the purposes of this Part as a result of any provision in this Part. (2) For such provisions, see, in particular— (a) section 775 (transfers within a group), and (b) sections 818 to 826 (transfer of business or trade).
Propose a change(1) This section applies if— (a) subsection (1) of section 775 (transfers within a group) would apply in relation to the transfer but for paragraph (c) of subsection (4) of that section, and (b) the asset has not at all times when the election under section 18A had effect been held by the transferor wholly for the purposes of a permanent establishment such as is mentioned in that paragraph. (2) The transfer is treated for the purposes of this Part as being at the following value— WDV + FPEA where— WDV is the tax written-down value of the asset, and FPEA is the amount which, for the purposes of Chapter 3A of Part 2, would in the case of the transferor be the foreign permanent establishments amount attributable to the transfer for the accounting period in which it took place if the transfer were at market value.
Propose a change(1) This section applies if— (a) the asset is transferred to the company mentioned in section 845(1), and (b) on a claim for relief under section 165 of TCGA 1992 (relief for gifts of business assets) in respect of the transfer, a reduction is made under section 165(4)(a). (2) The transfer is treated for the purposes of this Part as being at market value, less the amount of the reduction. (3) Any necessary adjustments may be made, by way of assessment, amendment of returns or otherwise, regardless of any relevant time limits.
Propose a change(1) This section applies where— (a) a company transfers its business to some or all of the shareholders of the company, and (b) a claim for disincorporation relief in respect of the transfer has been made under section 58 of the Finance Act 2013. (2) If section 735 applies to the transfer of the goodwill of the business, the transfer is treated for the purposes of this Part as being at the lower of— (a) the tax written-down value of the goodwill, and (b) its market value. (3) If section 736 applies to the transfer of the goodwill of the business, the transfer is treated for the purposes of this Part as being at the lower of— (a) the cost of the goodwill, and (b) its market value. (4) If section 738 applies to the transfer of the goodwill of the business, the proceeds of realisation of the goodwill are treated for the purposes of this Part as being nil. (5) In subsection (2)(a) the reference to the tax written-down value of the goodwill is to its tax written-down value immediately before the transfer. (6) In subsection (3)(a) “the cost of the goodwill” means the cost recognised for tax purposes (determined in accordance with section 736(6) and (7)). (7) In this section market value has the meaning given in section 845(5).
Propose a change(1) This section applies if— (a) a company which holds an intangible asset grants a licence or other right in respect of the asset to a related party, or (b) a company is granted a licence or other right in respect of an intangible asset by a related party that holds the asset. (1A) But this section does not apply in relation to a person (either the company or the related party) if— (a) either— (i) the profits and losses of the person are to be calculated for tax purposes as if the arm's length provision in relation to the grant had been made or imposed instead of the actual provision in relation to the grant as a result of Part 4 of TIOPA 2010 (transfer pricing), or (ii) they would be so calculated if the actual provision conferred a potential advantage in relation to United Kingdom taxation (within the meaning of that Part) on the person, and (b) the grant is a cross-border grant. (1B) A grant is a cross-border grant if, at the time of the grant, the related party is— (a) a UK resident company, but only if it has a qualifying permanent establishment in a territory outside the United Kingdom, (b) a non-UK resident company, other than a non-UK resident company that has a permanent establishment in the United Kingdom with a relevant connection to the licence or other right that is the subject of the grant, (c) a non-UK resident individual, other than an individual that carries on a trade, profession or vocation in the United Kingdom through a branch or agency that has a relevant connection to the licence or other right that is the subject of the grant, or (d) a partnership, but only if all of its members are non-UK resident or it has a qualifying permanent establishment in a territory outside the United Kingdom. (1C) Where the related party has a permanent establishment in a territory outside the United Kingdom, that permanent establishment is “qualifying” if— (a) exemption adjustments under section 18A(1) of CTA 2009 (exemption for profits or losses of foreign permanent establishments) would be made in calculating the taxable profits of the related party, and (b) those adjustments would include adjustments in respect of the licence or other right that is the subject of the grant. (1D) A permanent establishment of the related party in the United Kingdom has a relevant connection to the licence or other right that is the subject of the grant if the licence or other right is, in accordance with Chapter 4 of Part 2, attributable to that permanent establishment. (1E) A branch or agency of the related party has a relevant connection to the licence or other right that is the subject of the grant if— (a) where the related party is the grantor, if the asset from which the licence or other right is derived was used or held for the purposes of the branch or agency immediately before the grant, or (b) where the related party is the grantee, the licence or other right was acquired for use by, to be held by or for the purposes of, the branch or agency. (1F) In this section “branch or agency”— (a) means any factorship, agency, receivership, branch or management, but (b) does not include any person within any of the exemptions under sections 835G to 835K of ITA 2007 (persons who are not UK representatives). (2) The grant of the licence or other right is treated for all purposes of the Taxes Acts as being at market value as respects the grantor if— (a) the licence or other right was actually granted at less than market value, and (b) condition A or B is met. (3) The grant of the licence or other right is treated for all purposes of the Taxes Acts as being at market value as respects the grantee if— (a) the licence or other right was actually granted at more than market value, and (b) condition A or B is met. (4) Condition A is that the asset is a chargeable intangible asset in relation to the grantor immediately before the licence or right in respect of it is granted. (5) Condition B is that the licence or right is a chargeable intangible asset in relation to the grantee immediately after it is granted. (6) This section is subject to— (a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (b) section 849AD (grants involving other taxes), and (c) section 900F (special rules in respect of assets that were pre-FA 2002 assets etc). (7) References in subsection (1) to a related party in relation to a company are to be read as including references to a person in circumstances where the participation condition is met as between that person and the company. (8) References in subsection (7) to a company include a firm in a case where, for the purposes of section 1259, references in subsection (1) to a company are read as references to the firm. (9) Section 148 of TIOPA 2010 (when the participation condition is met) applies for the purposes of subsection (7) as it applies for the purposes of section 147(1)(b) of TIOPA 2010. (10) Subsection (11) applies where— (a) a gain on the grant by a firm of a licence or other right in respect of an intangible fixed asset is a gain to be taken into account for the purposes of section 1259, and (b) for those purposes, references in subsection (1) to a company are read as references to the firm. (11) Where this subsection applies, the gain referred to in subsection (10)(a) is to be treated for the purposes of this section as if it were a chargeable realisation gain for the purposes of section 741(1) (meaning of “chargeable intangible asset”). (12) In this section— “actual provision” and “arm’s length provision” are to be construed in accordance with Part 4 of TIOPA 2010 (transfer pricing), “market value” means the price the licence or right 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.
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Propose a change(1) This section applies if— (a) in a case where section 849AB applies and the licence or other right is granted by the company to a related party, the grant is at less than its market value, (b) in a case where that section applies and the licence or other right is granted to the company by a related party, the grant is at more than its market value, and (c) conditions A and B apply. (2) Condition A is that the related party— (a) is not a company, or (b) is a company in relation to which— (i) in a case within subsection (1)(a), the licence or other right is not a chargeable intangible asset immediately after the grant to it, or (ii) in a case within subsection (1)(b), the relevant asset is not a chargeable intangible asset immediately before the grant by it. (3) Condition B is that the grant of the licence or right— (a) gives rise to an amount to be taken into account in calculating any person's income, profits or losses for tax purposes because of a relevant provision, or (b) would do so apart from section 849AB(2) or (3). (4) If this section applies, section 849AB(2) and (3) does not apply in relation to the calculation referred to in subsection (3) for the purposes of any relevant provision. (5) In this section “relevant provision” means— (a) Chapter 2 of Part 23 of CTA 2010 (matters which are distributions), except section 1000(2), and (b) Part 3 of ITEPA 2003 (employment income: earnings and benefits etc treated as earnings).
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Propose a change(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.
Propose a change(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.
Propose a change(1) This section applies if a grant or other payment is intended by the payer to meet, directly or indirectly, expenditure of a company on an intangible fixed asset. (2) A gain recognised in the company's profit and loss account in respect of the grant or other payment is treated for the purposes of section 721 (receipts recognised as they accrue) as a gain representing a receipt in respect of the intangible fixed asset. (3) This section does not apply to a grant within section 853.
Propose a change(1) This section applies to the following grants (“exempt grants”)— (a) grants under Part 2 of the Industrial Development Act 1982 (c. 52) (regional development grants), and (b) grants made under Northern Ireland legislation and declared by the Treasury by order to correspond to a grant under that Part. (2) A gain in respect of an exempt grant to a company is ignored for the purposes of this Part, even though it is recognised in determining the company's profit or loss. (3) This subsection applies if, as a result of an exempt grant being brought into account by the company to which it is made, there is a reduction— (a) in the amount of a loss recognised in determining the company's profit or loss, or (b) in the amount of expenditure on an intangible fixed asset that is capitalised for accounting purposes. (4) If subsection (3) applies, the amount of the reduction is added back for the purposes of this Part.
Propose a change(1) The Treasury may make provision by regulations as to the application of this Part in relation to a company that is the finance lessor of an intangible asset that is the subject of a finance lease. (2) Section 855 is about the provision that the regulations may make. (3) References in this section and that section to a finance lease— (a) have the meaning they have for accounting purposes, and (b) include hire-purchase, conditional sale or other arrangements if they are of a similar character to a finance lease. (4) References to the finance lessor or finance lessee have a corresponding meaning. (5) Regulations under this section may be made so as to have effect from 1 April 2002.
Propose a change(1) Regulations under section 854 may provide that this Part applies as if the asset were an intangible fixed asset of the finance lessor and not a financial asset, even though the asset is accounted for by the finance lessor as a financial asset. (2) The regulations may provide that this Part applies as if the amount at which the asset is recognised in the finance lessor's balance sheet were capitalised expenditure on an intangible fixed asset, but that— (a) no election may be made under section 730 (writing down at fixed rate: election for fixed-rate basis) in respect of that amount, and (b) that amount is not to be treated as capitalised expenditure for the purposes of section 756(2) (roll-over relief in case of realisation and reinvestment: conditions to be met in relation to expenditure on other assets). (3) The regulations may provide that if an asset formerly recognised by the finance lessor for accounting purposes as an intangible fixed asset becomes subject to a finance lease (and so comes to be accounted for as a financial asset), the value of the asset so created is recognised as realisation proceeds of the intangible fixed asset on the change of accounting treatment. (4) The regulations may provide that assets partially excluded from this Part by sections 810 to 813 ... (assets excluded except as respects royalties) are entirely excluded from this Part as respects the finance lessor if they— (a) are subject to a finance lease, and (b) are accounted for by the finance lessor as financial assets. (5) The regulations may provide for excluding from the regulations assets used by the finance lessee for the purposes of a trade or business in respect of which the finance lessee is liable to income tax. (6) The regulations may provide that an intangible asset counts as a pre-FA 2002 asset in the hands of the finance lessor if the finance lessee is— (a) a company for which the asset was the whole or part of a pre-FA 2002 asset, or (b) a person who is a related party in relation to such a company. (7) The regulations may make incidental, supplemental, consequential and transitional provision and savings. (8) That provision may include modifications of the operation of other provisions of the Corporation Tax Acts.
Propose a change(1) Any reference in this Part to the acquisition or realisation of an asset includes a reference to the acquisition or realisation of that asset together with other assets. (2) For the purposes of this Part assets acquired or realised as a result of one bargain are treated as acquired or realised together even though— (a) separate prices are, or purport to be, agreed for separate assets, or (b) there are, or purport to be, separate acquisitions or realisations of separate assets. (3) If assets are acquired together, any values allocated to particular assets by the company in accordance with generally accepted accounting practice must be accepted for the purposes of this Part. (4) If no such values are so allocated, so much of the expenditure as on a just and reasonable apportionment is properly attributable to each asset is treated for the purposes of this Part as referable to that asset. (5) If assets are realised together, so much of the proceeds of realisation as on a just and reasonable apportionment is properly attributable to each asset is treated for the purposes of this Part as proceeds of the realisation of that asset.
Propose a change(1) This section applies if— (a) a company is treated for the purposes of this Part as acquiring an asset at market value or by reference to the arm’s length provision, but (b) the accounting value of the asset transferred is nil , or a negligible value, in the hands of the transferee. (2) In such a case any reference in this Part to— (a) the cost of the asset recognised for accounting purposes, (b) the accounting value of the asset, or (c) any loss recognised for accounting purposes in respect of capitalised expenditure on the asset, is a reference to the cost, value or loss that would have been recognised if the asset had been acquired at market value or (as the case may be) by reference to the arm’s length provision. (3) If the asset is revalued, the revaluation is ignored. (4) In this section “revaluation” has the same meaning as in section 723 (see subsection (5) of that section) and “revalued” must be read accordingly.
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Propose a change(1) If an asset ceases to be a chargeable intangible asset in relation to a company in any of the circumstances specified in subsection (2), this Part applies as if— (a) immediately before the asset ceased to be a chargeable intangible asset in relation to the company, the company had realised the asset for its market value at that time, and (b) the company had immediately reacquired it at that value. (2) The circumstances are— (a) that the company ceases to be UK resident, (b) in the case of a company that is not UK resident, any circumstances not involving the realisation of the asset by the company, and (c) that the asset begins to be held for the purposes of a mutual trade or business. (3) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
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Propose a change(1) This section applies if an asset becomes a chargeable intangible asset in relation to a company— (a) on the company becoming UK resident, (b) in the case of a company that is not UK resident, on the asset beginning to be held— (i) for the purposes of a trade carried on by the company in the United Kingdom through a permanent establishment, (ii) for the purposes of a trade carried on by the company of dealing in or developing UK land, (iii) for the purposes of a UK property business carried on by the company, or (iv) for the purposes of enabling the company to generate other UK property income (within the meaning given by section 5(6)), or (c) on the asset ceasing to be held for the purposes of a mutual trade or business. (2) This Part applies as if— (a) the company had acquired the asset immediately after it became a chargeable intangible asset in relation to the company, and (b) had done so for its accounting value at that time. (3) But subsection (2)(b) is subject to section 863A.
Propose a change(1) This section applies if— (a) an asset becomes a chargeable intangible asset in relation to a company by reason of an event specified in section 863(1)(a) or (b), and (b) on the occurrence of that event the company becomes subject to an EU exit charge in respect of the asset. (2) This Part applies as if the company had acquired the asset for its market value at the time it became a chargeable intangible asset in relation to the company. (3) “EU exit charge” means a charge to tax under the law of a member State in accordance with Article 5(1) of Directive (EU) 2016/1164 of the European Parliament and of the Council of 12 July 2016 laying down rules against tax avoidance practices that directly affect the functioning of the internal market.
Propose a change(1) In determining whether a credit or a debit is to be brought into account under this Part and, if so, its amount, any tax avoidance arrangements are ignored. (2) Arrangements are “tax avoidance arrangements” for this purpose if their main object or one of their main objects is to enable a company— (a) to obtain a debit under this Part to which it would not otherwise be entitled, (b) to obtain a debit under this Part which exceeds that to which it would otherwise be entitled, (c) to avoid having to bring a credit into account under this Part, or (d) to reduce the amount of any such credit. (3) In this section— “arrangements” includes any scheme, agreement or understanding, whether or not it is legally enforceable, and “brought into account” means brought into account for tax purposes.
Propose a change(1) No debit may be brought into account for tax purposes under this Part in respect of expenditure that is not generally deductible for tax purposes. (2) Expenditure is “not generally deductible for tax purposes” so far as revenue expenditure of that description incurred for the purposes of a trade would be non-deductible because of a provision specified in subsection (3). (3) Those provisions are— (a) section 56 (car ... hire), (b) section 1298 (business entertainment and gifts), (c) section 1304 (crime-related payments), and (d) section 246(2) of FA 2004 (expenditure on benefits under employer-financed retirement benefits schemes).
Propose a change(1) This subsection applies if— (a) a debit in respect of employees' remuneration is recognised by a company for accounting purposes, and (b) apart from this section, a debit in respect of the remuneration could be brought into account for the purposes of this Part for the period of account in which the debit is recognised. (2) No such debit may be so brought into account unless the remuneration is paid before the end of the period of 9 months beginning with the end of the period of account. (3) If the remuneration is paid after the end of the 9 month period, the debit may be brought into account for the purposes of this Part for the period of account in which it is paid. (4) Section 867 makes further provision relating to the application of this section.
Propose a change(1) For the purposes of section 866 a debit in respect of employees' remuneration recognised for accounting purposes includes an amount reserved in the accounts of an employer with a view to its becoming employees' remuneration. (2) For the purposes of section 866 it does not matter if the debit is in respect of— (a) particular employments, or (b) employments generally. (3) Any adjustment required by section 866 of an accounting debit that is partly referable to an amount to which that section applies and partly to other matters must be made on a just and reasonable basis. (4) In making a calculation for tax purposes that has to be made before the end of the 9 month period mentioned in section 866(2), it must be assumed that any remuneration which is unpaid when the calculation is made will not be paid before the end of that period. (5) But if the remuneration is subsequently paid before the end of the period, nothing in subsection (4) prevents the calculation being revised and any tax return being amended accordingly. (6) For the purposes of section 866 and this section, remuneration is paid when it— (a) is treated as received by an employee for the purposes of ITEPA 2003 by section 18 or 19 of that Act (receipt of money and non-money earnings), or (b) would be so treated if it were not exempt income. (7) In section 866 and this section— “employee” includes an office-holder and so “employment” includes an office, and “remuneration” means an amount which is or is treated as earnings for the purposes of ITEPA 2003.
Propose a change(1) This section applies if— (a) a debit in respect of pension contributions is recognised by a company for accounting purposes, and (b) the contributions are not paid until after the end of the period of account in which the debit is recognised. (2) The contributions may be brought into account for the purposes of this Part only when they are paid. (3) For the purposes of this section “pension contributions” means— (a) sums paid by an employer by way of contributions under a registered pension scheme, (b) sums paid to the trustees or managers of such a scheme that are treated as if they were the payment of contributions under the pension scheme (see section 199 of FA 2004), or (c) expenses within section 246(3) of FA 2004 (expenditure on benefits under employer-financed retirement benefits schemes). (4) Any adjustment required by this section of an accounting debit that is partly referable to an amount to which this section applies and partly to other matters must be made on a just and reasonable basis.
Propose a change(1) No debit may be brought into account for the purposes of this Part in respect of a debt owed to the company, except— (a) by way of impairment loss, or (b) so far as the debt is released as part of a statutory insolvency arrangement. (2) If a debt is so released, any gain in respect of the release that is brought into account for accounting purposes by the debtor is disregarded for the purposes of this Part. (3) Any other gain in respect of an unpaid debt in respect of an intangible fixed asset that is brought into account by the debtor for accounting purposes is treated for the purposes of section 721 (receipts recognised as they accrue) as a gain in respect of an intangible fixed asset. (4) Any adjustment required by this section of an accounting gain or loss that is partly referable to an amount affected by this section and partly to other matters must be made on a just and reasonable basis. (5) In this section “debt” includes an obligation or liability that falls to be discharged otherwise than by the payment of money.
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Propose a change(1) Subsection (2) applies where— (a) a company has made a claim for relief under section 152 or 153 of TCGA 1992 (roll-over relief) during the period beginning with 1 April 2009 and ending with 19 March 2014, and (b) the relief claimed relates to disposal proceeds that are applied in acquiring an intangible fixed asset within the meaning of this Part. (2) The company is treated for the purposes of this Part as if the cost of the asset recognised for tax purposes were reduced on 19 March 2014 by the amount in respect of which the relief under section 152 or 153 of TCGA 1992 is given. (3) But the effect of subsection (2) must not be to reduce the tax written-down value of the asset to below nil. (4) The references to adjustments in sections 742(3) and 743(3) (assets written down) include any adjustment required by subsection (2).
Propose a change(1) This Chapter applies if— (a) there is a change of accounting policy in drawing up a company's accounts from one period of account to the next, and (b) the approach in each of those periods accords with the law and practice applicable in relation to that period. (2) In this Chapter— (a) the first of those periods of account is referred to as “the earlier period”, and (b) the next is referred to as “the later period”. (3) This Chapter applies, in particular, if— (a) the company prepares accounts for the earlier period in accordance with UK generally accepted accounting practice and for the later period in accordance with international accounting standards, or (b) the company prepares accounts for the earlier period in accordance with international accounting standards and for the later period in accordance with UK generally accepted accounting practice.
Propose a change