Finance Act 2004

Finance Act 2002 U.K.

Introductory U.K.

14 U.K. The Finance Act 2002 (c. 23) is amended as follows.

Derivative contracts U.K.

15 (1) Schedule 26 (derivative contracts) is amended as follows. U.K.

(2) In Part 6 (special computational provisions) in paragraph 28 (transactions within groups) after sub-paragraph (3) insert—

“(3A) Where the debits or credits to be brought into account for the purposes of this Schedule in respect of any amounts fall to be determined in accordance with sub-paragraph (3), Schedule 28AA to the Taxes Act 1988 (provision not at arm’s length) does not apply in relation to those amounts.”.

(3) After paragraph 31 insert—

“Amounts imputed under Schedule 28AA to the Taxes Act 1988 U.K.

31A (1) This paragraph applies where, in pursuance of Schedule 28AA to the Taxes Act 1988 (provision not at arm’s length), an amount falls to be treated as any of the following—

(a) an amount of profits or losses (disregarding any charges or expenses) arising to a company from any of its derivative contracts or related transactions;

(b) charges or expenses incurred by a company under or for the purposes of any of its derivative contracts or related transactions.

(2) That Schedule shall have effect, notwithstanding the provisions of any authorised accounting method, so as to require credits or debits relating to the amount so treated to be brought into account for the purposes of this Chapter to the same extent as they would be in the case of an actual amount of—

(a) profits or losses (disregarding any charges or expenses) arising to the company from the derivative contract or related transaction, or

(b) charges or expenses incurred under or for the purposes of the derivative contract or related transaction,

as the case may be.”.

Intangible fixed assets U.K.

16 (1) Schedule 29 (gains and losses of a company from intangible fixed assets) is amended as follows. U.K.

(2) In paragraph 55 (transfers within a group), after sub-paragraph (1) insert—

“(1A) Where this paragraph applies in relation to the transfer of an asset, Schedule 28AA to the Taxes Act 1988 (provision not at arm’s length) does not apply in relation to the transfer.”.

(3) In paragraph 92 (transfer between company and related party treated as being at market value) in sub-paragraph (3) (cases where consideration for transfer falls within Schedule 28AA without falling to be adjusted)—

(a) at the end of paragraph (a) insert “ , but ”,

(b) at the end of paragraph (b) omit “, and”,

(c) omit paragraph (c) (which refers to paragraph 5(2) of Schedule 28AA to the Taxes Act 1988).