Valid from 01/04/2009
(1)This Chapter makes provision about how this Part applies in the case of certain transactions involving groups.
(2)In particular—
(a)for the treatment of transfers within groups as “tax-neutral transfers” and the meaning of that expression, see sections 775 and 776,
(b)for the application of Chapter 7 (roll-over relief in case of realisation and reinvestment) in relation to a company that is a member of a group, see sections 777 to 779,
(c)for the rules that apply where a company ceases to be a member of a group, see—
(i)sections 780 to 791 (which provide for the deemed realisation of chargeable intangible fixed assets and their deemed reacquisition at market value), and
(ii)sections 792 to 798 (which provide for elections for a different member of the group to be treated as the company to which any gain on the deemed transfer accrues, how roll-over relief applies in such a case and for the recovery of the charge on any such gain), and
(d)for the disregard of some payments made in connection with claims for relief under Chapter 7 where this Chapter applies and payments made in connection with such elections as are mentioned in paragraph (c)(ii), see section 799.
(3)Section 788 contains provisions that supplement sections 780 to 787.
(1)A transfer of an intangible fixed asset from one company (“the transferor”) to another company (“the transferee”) is tax-neutral for the purposes of this Part if—
(a)at the time of the transfer both companies are members of the same group,
(b)immediately before the transfer the asset is a chargeable intangible asset in relation to the transferor, and
(c)immediately after the transfer the asset is a chargeable intangible asset in relation to the transferee.
(2)For the consequences of a transfer being tax-neutral for the purposes of this Part, see section 776.
(3)Schedule 28AA to ICTA (provision not at arm's length) does not apply in relation to a transfer to which subsection (1) applies.
(4)Subsection (1) does not apply if—
(a)the transferor or transferee is a qualifying society within the meaning of section 461A of ICTA (incorporated friendly societies entitled to exemption from tax), or
(b)the transferee is a dual resident investing company within the meaning of section 404 of that Act (limitation of group relief).
(1)This section sets out the consequences of a transfer of an asset being “tax-neutral” for the purposes of this Part.
(2)The transfer is treated for those purposes as not involving—
(a)any realisation of the asset by the transferor, or
(b)any acquisition of the asset by the transferee.
(3)The transferee is treated for those purposes—
(a)as having held the asset at all times when it was held by the transferor, and
(b)as having done all such things in relation to the asset as were done by the transferor.
(4)In particular—
(a)the original cost of the asset in the hands of the transferor is treated as the original cost in the hands of the transferee, and
(b)all such credits and debits in relation to the asset as have been brought into account for tax purposes by the transferor under this Part are treated as if they had been brought into account by the transferee.
(5)The references in subsection (4)(a) to the cost of the asset are to the cost recognised for tax purposes.
(1)This section deals with the application of Chapter 7 (roll-over relief in case of realisation and reinvestment) in relation to a company that is a member of a group.
(2)Chapter 7 does not apply if the expenditure on other assets is expenditure on the acquisition of assets from another member of the same group by a tax-neutral transfer.
(3)Chapter 7 applies as if two companies (“A” and “B”) are the same person if—
(a)the realisation of the old asset is by A,
(b)at the time of the realisation A is a member of a group,
(c)the expenditure on other assets is by B,
(d)B is a member of the same group as A at the time the expenditure is incurred (“the expenditure time”),
(e)B is not a dual resident investing company within the meaning of section 404 of ICTA (limitation of group relief) at the expenditure time,
(f)immediately after the expenditure time the other assets are chargeable intangible assets in relation to B, and
(g)both A and B make a claim for relief under Chapter 7.
(4)Expressions used in this section that are defined for the purposes of Chapter 7 have the same meaning in this section.
(5)In particular, see section 754 for the meaning of “the old asset” and “the other assets”.
(1)Chapter 7 (roll-over relief in case of realisation and reinvestment) applies in accordance with section 779 if—
(a)a company (“A”) acquires a controlling interest in another company (“B”), and
(b)intangible fixed assets (“underlying assets”) are held by B or one or more other companies within subsection (2).
(2)A company is within this subsection if—
(a)it was not in the same group as A before the acquisition, and
(b)as a result of the acquisition it is in the same group as A immediately after it.
(3)For this purpose A acquires a controlling interest in B if—
(a)A and B are not in the same group,
(b)A acquires shares in B, and
(c)as a result of the acquisition A and B are in the same group immediately after the acquisition.
(4)A claim for relief under Chapter 7 made because of section 779 must be made jointly by A and the company or companies holding the underlying assets concerned.
(5)In this section and section 779 expressions that are defined for the purposes of Chapter 7 have the same meaning as in that Chapter.
(1)The expenditure by A on the acquisition is treated as expenditure on acquiring the underlying assets.
(2)The amount of the expenditure so treated is taken to be the lower of—
(a)the tax written-down value of the underlying assets immediately before the acquisition, and
(b)the amount or value of the consideration for the acquisition.
(3)The requirement in section 756(3) (that immediately after the expenditure on acquiring the assets is incurred the assets must be chargeable intangible assets in relation to A) is treated as met in relation to the underlying assets if the condition in subsection (4) is met.
(4)That condition is that the underlying assets are chargeable intangible assets in relation to the company by which they are held immediately after the acquisition by A.
(5)The tax written-down value of the underlying assets in the hands of the company by which they are held is reduced by the amount available for relief (but see subsections (6) and (7)).
(6)If—
(a)there is more than one underlying asset, and
(b)the amount of expenditure on other assets that is treated as incurred exceeds the amount available for relief,
the company which holds the underlying assets may decide how the amount available for relief is to be allocated in reducing the tax written-down values of the assets.
(7)If there are two or more such companies, they may agree between them how that amount is to be allocated.
(8)In this section references to “A” and “B” and “underlying assets” must be read in accordance with section 778(1).
(1)This section applies if—
(a)a company (“the transferor”) that is a member of a group (“the group”) transfers an intangible fixed asset (“the relevant asset”) to another company (“the transferee”),
(b)immediately before the transfer the relevant asset is a chargeable intangible asset in relation to the transferor,
(c)immediately after the transfer the relevant asset is a chargeable intangible asset in relation to the transferee,
(d)the transferee—
(i)is a member of the group at the time of the transfer, or
(ii)subsequently becomes a member of the group,
(e)the transferee ceases to be a member of the group during the period of 6 years after the date of the transfer, and
(f)when the transferee ceases to be a member of the group, the relevant asset is held by the transferee or an associated company (see section 788(3)) also leaving the group.
(2)This Part applies as if the transferee—
(a)had realised the relevant asset immediately after its transfer to the transferee for its market value at that time, and
(b)had immediately reacquired the asset at that value.
(3)The adjustments to be made as a result of subsection (2), by the transferee or a company to which the relevant asset has been subsequently transferred, in relation to the relevant period must be made by bringing the total net credit or debit into account as if it had arisen immediately before the transferee ceased to be a member of the group.
(4)In subsection (3) “the relevant period” means the period between—
(a)the transfer of the relevant asset to the transferee, and
(b)the transferee ceasing to be a member of the group.
(5)This section is subject to—
(a)section 782 (certain transferees of businesses etc not treated as leaving group),
(b)section 783 (associated companies leaving group at the same time),
(c)section 785 (principal company becoming member of another group),
(d)section 787 (company ceasing to be member of group because of exempt distribution), and
(e)section 789 (merger carried out for genuine commercial reasons).
(6)See section 788 (provisions supplementing this section and sections 781 to 787) for the interpretation of certain expressions used in this section or those sections.
(7)For the way in which Chapter 7 applies if a company is treated as having realised an asset as a result of this section, see section 791 (application of roll-over relief in relation to degrouping charge).
(1)For the purposes of Chapter 6 (how credits and debits are given effect) credits or debits brought into account as a result of section 780 take their character from the purposes for which the relevant asset was held by the transferee immediately after the transfer.
(2)But subsection (1) does not apply if conditions A and B are met.
(3)Condition A is that immediately after the transfer the relevant asset was held by the transferee for the purposes of a trade, business or concern within section 747, 748 or 749.
(4)Condition B is that the transferee ceased to carry on that trade, business or concern before it ceased to be a member of the group.
(5)If conditions A and B are met, a credit or debit brought into account because of section 780 is treated for the purposes of Chapter 6 as a non-trading credit or debit.
(6)References in this section to “the transferee” and the relevant asset” must be read in accordance with section 780.
(1)This section applies if—
(a)the relevant asset is transferred in the course of a transfer of business to which section 820 applies or which includes such a transfer as is mentioned in section 807B(2)(b)(iii) of ICTA and in respect of which section 807C of that Act applies (European cross-border transfers of business), and
(b)in consequence of the transfer the transferee ceases to be a member of a group (“Group 1”).
(2)For the purposes of section 780, the transferee is not treated as having left Group 1.
(3)If as a result of the transfer the transferee becomes a member of another group (“Group 2”), it is treated for the purposes of section 780 as if Group 1 and Group 2 were the same.
(4)References in this section to “the transferee” and “the relevant asset” must be read in accordance with section 780.
(1)If two or more companies that are associated (see section 788(3)) cease to be members of a group at the same time, section 780 does not apply in relation to a transfer between them.
(2)This subsection applies if—
(a)a company (“the transferee”) that is a member of a group of companies (“the first group”) acquires an asset from another company (“the transferor”) which is a member of that group at the time of the transfer,
(b)the transferee ceases to be a member of the first group,
(c)subsection (1) applies in relation to the transferee ceasing to be a member of the first group (so that section 780 does not apply),
(d)the transferee subsequently ceases to be a member of another group of companies (“the second group”), and
(e)there is a relevant connection between the two groups (see section 784).
(3)If subsection (2) applies, section 780 applies in relation to the transferee ceasing to be a member of the second group as if both companies had been members of the second group at the time of the transfer.
(4)This section is subject to section 789 (merger carried out for genuine commercial reasons).
(1)For the purposes of section 783(2) there is a relevant connection between the first group and the second group if, at the time when the transferee ceases to be a member of the second group, the company which is the principal company of that group is under the control of—
(a)a person within subsection (2),
(b)a person or persons within subsection (3), or
(c)a person or persons within subsection (4).
(2)A person is within this subsection if it is the company—
(a)that is the principal company of the first group, or
(b)if that group no longer exists, that was its principal company when the transferee ceased to be a member of it.
(3)A person or persons are within this subsection if they—
(a)control the company within subsection (2), or
(b)have had it under their control at any time in the period since the transferee ceased to be a member of the first group.
(4)A person or persons are within this subsection if they have, at any time in that period, had under their control either—
(a)a company that would have fallen within subsection (3) if it had continued to exist, or
(b)a company to which subsection (5) applies.
(5)This subsection applies to a company if, had the company continued to exist—
(a)it would have fallen within subsection (4) because of its control of another company that would have fallen within subsection (3) if that other company had continued to exist, or
(b)it would have fallen within subsection (4) because of its control of a company to which paragraph (a) or this paragraph would have applied.
(6)Section 416(2) to (6) of ICTA (meaning of control) applies for the purposes of this section as it applies for the purposes of Part 11 of that Act.
(7)But a person carrying on a business of banking is not treated for those purposes as having control of a company just because of—
(a)having any rights in respect of loan capital or debt issued or incurred by the company for money lent by that person to the company in the ordinary course of that business, or
(b)the consequences of having exercised such rights.
(8)References in this section to “the first group”, “the second group” and “the transferee” must be read in accordance with section 783.
(1)Section 780 does not apply if a company ceases to be a member of a group just because the principal company of the group becomes a member of another group (“the second group”).
(2)This subsection applies if—
(a)section 780 would have applied but for subsection (1),
(b)after the transfer and before the end of the period of 6 years after the date of the transfer, the transferee ceases to meet the condition that it is both a 75% subsidiary and an effective 51% subsidiary of one or more members of the second group (“the qualifying condition”), and
(c)at the time at which the transferee ceases to do so, the relevant asset is held by the transferee or another company in the same group.
(3)If subsection (2) applies, this Part applies as if immediately after the transfer to the transferee of the relevant asset the transferee had—
(a)realised the asset for its market value at that time, and
(b)immediately reacquired the asset at that value.
(4)The adjustments to be made as a result of subsection (3), by the transferee or a company to which the relevant asset has been subsequently transferred, in relation to the relevant period must be made by bringing the total net credit or debit into account as if it had arisen immediately before the transferee ceased to meet the qualifying condition.
(5)In subsection (4) “the relevant period” means the period between—
(a)the transfer of the relevant asset to the transferee, and
(b)the transferee ceasing to meet the qualifying condition.
(6)This section is subject to section 789 (merger carried out for genuine commercial reasons).
(7)References in this section to “the transferee” and “the relevant asset” must be read in accordance with section 780.
(8)For the way in which Chapter 7 applies if a company is treated as having realised an asset as a result of this section, see section 791 (application of roll-over relief in relation to degrouping charge).
(1)For the purposes of Chapter 6 (how credits and debits are given effect) credits or debits brought into account because of section 785 take their character from the purposes for which the relevant asset was held by the transferee immediately after the transfer.
(2)But subsection (1) does not apply if conditions A and B are met.
(3)Condition A is that immediately after the transfer the asset was held by the transferee for the purposes of a trade, business or concern within section 747, 748 or 749.
(4)Condition B is that the transferee ceased to carry on that trade, business or concern before it ceased to meet the qualifying condition.
(5)If conditions A and B are met, a credit or debit brought into account because of section 785 is treated for the purposes of Chapter 6 as a non-trading credit or debit.
(6)References in this section to “the transferee” and the relevant asset” must be read in accordance with section 780.
(1)Sections 780 and 785 do not apply if a company ceases to be a member of a group just because of an exempt distribution, unless subsection (2) applies.
(2)This subsection applies if there is a chargeable payment within 5 years after the making of the exempt distribution.
(3)If subsection (2) applies, all such adjustments as may be required, by way of assessment, amendment of returns or otherwise, may be made within the period of 3 years after the making of the chargeable payment.
(4)Those adjustments may be made despite any time limit on the making of an assessment or the amendment of a return.
(5)In this section—
“exempt distribution” means a distribution that is exempt because of section 213(2) of ICTA (distributions involving shares in 75% subsidiaries), and
“chargeable payment” has the meaning given in section 214(2) of that Act.
(6)Subsections (7) and (8) apply for determining for the purposes of this section whether one company is a 75% subsidiary of another company.
(7)The other company is treated as not being the owner of any share capital that it owns directly in a body corporate if a profit on a sale of the shares would be treated as a trading receipt of its trade.
(8)The other company is treated as not being the owner of any share capital that—
(a)it owns indirectly, and
(b)is owned directly by a body corporate for which a profit on the sale of the shares would be a trading receipt.
(1)References in sections 780 to 787 (degrouping) to a company ceasing to be a member of a group do not include cases where a company ceases to be a member of a group in consequence of another member of the group ceasing to exist.
(2)For the purposes of those sections an asset acquired by a company is treated as the same as an asset owned at a later time by that company or an associated company if the value of the second asset is derived in whole or in part from the first asset.
(3)For the purposes of those sections and this section two or more companies are associated if, by themselves, they would form a group of companies.
(1)Sections 780 to 787 do not apply if—
(a)the transferee ceases to be a member of a group of companies (“the group”) as part of a merger,
(b)the merger is carried out for genuine commercial reasons, and
(c)the avoidance of liability to tax is not the main purpose of the merger or one of its main purposes.
(2)For this purpose “merger” means an arrangement in respect of which each of conditions A to D is met.
(3)Condition A is that—
(a)as a result of the arrangement one or more companies (“the acquiring company” or “the acquiring companies”) acquire one or more interests in the whole or part of the business which, before the arrangement took effect, was carried on by the transferee,
(b)the acquiring company is not a member of the group or, as the case may be, none of the acquiring companies is such a member,
(c)at least 25% by value of each of the interests acquired consists of a holding of ordinary share capital, and
(d)the acquisition is not with a view to the disposal of the interests.
(4)Condition B is that—
(a)as a result of the arrangement one or more members of the group acquire one or more interests in the whole or part of the business or each of the businesses which, before the arrangement took effect, was carried on—
(i)by the acquiring company or acquiring companies, or
(ii)by a company at least 90% of whose ordinary share capital was then beneficially owned by two or more of the acquiring companies,
(b)at least 25% by value of each of the interests acquired consists of a holding of ordinary share capital,
(c)the remainder of the interest, or as the case may be of each of the interests, acquired consists of a holding of share capital (of any description) or debentures or both, and
(d)the acquisition is not with a view to the disposal of the interests.
(5)Condition C is that the value or, as the case may be, the total value of the interest or interests acquired as mentioned in subsection (3) is substantially the same as the value or, as the case may be, the total value of the interest or interests acquired as mentioned in subsection (4).
(6)Condition D is that the consideration for the acquisition of the interest or interests acquired by the acquiring company or acquiring companies as mentioned in subsection (3)—
(a)consists of, or is applied in the acquisition of, the interest or interests acquired by members of the group as mentioned in subsection (4), or
(b)consists partly of, and as to the balance is applied in the acquisition of, that interest or those interests.
(7)Section 790 supplements this section.
(1)In section 789 “arrangement” includes a series of arrangements.
(2)For the purposes of section 789(3) and (4) a member of a group of companies is treated as carrying on as one business the activities of that group.
(3)For the purposes of section 789(3)(c), (4)(b) and (5) the value of an interest is determined as at the date of its acquisition.
(4)For the purposes of section 789(6), any part of the consideration for the acquisition which is small by comparison with the total is ignored.
(1)Chapter 7 (roll-over relief in case of realisation and reinvestment) applies with the modifications specified in subsections (2) to (4) if a company is treated as having realised an asset as a result of section 780 or 785 (degrouping).
(2)In section 755 (conditions relating to the old asset), for the references to the old asset being a chargeable intangible asset in relation to the company substitute references to its being a chargeable intangible asset in relation to the transferor.
(3)In section 756(1) (conditions relating to expenditure on other assets), for the references to the date of realisation of the old asset substitute—
(a)in a case within section 780, references to the date on which the transferee ceased to be a member of the group, and
(b)in a case within section 785, references to the date on which the transferee ceased to meet the qualifying condition.
(4)For references in Chapter 7 to the proceeds of realisation substitute references to the amount for which the transferee is treated as having realised the asset.
(5)A reduction of that amount as a result of a claim for relief under Chapter 7 does not affect the value at which the company is treated as having reacquired the asset.
(6)In this section “the transferee” and “the transferor” have the same meaning as in section 780.
(1)This section applies if a chargeable realisation gain (see section 741) accrues to a company (“A”) under section 780 or 785 in respect of an asset.
(2)A and a company (“B”) that was a member of the relevant group at the relevant time may jointly elect that the gain, or such part of it as may be specified in the election, must be treated as accruing to B, and not A.
(3)In a case within section 780—
(a)“the relevant group” is the group of which A was a member at the relevant time, and
(b)“the relevant time” is immediately before A ceases to be a member of the group.
(4)In a case within section 785—
(a)“the relevant group” is the second group (within the meaning of that section), and
(b)“the relevant time” is immediately before A ceases to meet the qualifying condition (within the meaning of that section).
(5)The effect of the election is that the gain, or the part specified in the election, is treated—
(a)as if it had accrued to B at the relevant time as a non-trading credit for the purposes of Chapter 6 (how credits and debits are given effect), and
(b)if B is not UK resident at the relevant time, as if it had accrued in respect of an asset held for the purposes of a permanent establishment of B in the United Kingdom.
(6)Section 793 makes further provision about elections under this section.
(7)Section 794 makes provision for enabling claims under Chapter 7 to be made by B.
(8)In sections 793 and 794 references to “A” and “B” and “the relevant time” must be read in accordance with this section.
(1)An election under section 792 may be made only if subsection (2) or (3) applies to B.
(2)This subsection applies if at the relevant time B was UK resident.
(3)This subsection applies if at the relevant time—
(a)B carried on a trade in the United Kingdom through a permanent establishment, and
(b)B was not exempt from corporation tax in respect of the income or chargeable gains of that permanent establishment because of arrangements under Part 18 of ICTA (double taxation relief).
(4)An election under section 792 may not be made if at the relevant time B was—
(a)a qualifying society within the meaning of section 461A of ICTA (incorporated friendly societies entitled to exemption from tax), or
(b)a dual resident investing company within the meaning of section 404 of that Act (limitation of group relief).
(5)An election under section 792 may only be made—
(a)by notice in writing to an officer of Revenue and Customs, and
(b)not later than 2 years after the end of the accounting period of A in which the relevant time falls.
(1)This section applies where an election has been made under section 792 for the purpose of enabling B to make a claim under Chapter 7 (roll-over relief on realisation and reinvestment).
(2)Chapter 7 applies as if the realisation of the asset treated as occurring under section 780 or 785 had been by B, and not A.
(3)The conditions in section 755 (conditions relating to the old asset) are treated as met in relation to the asset if they would have been met if there had been no election and A had made the claim.
(4)The proceeds of realisation and the cost of the old asset recognised for tax purposes are what they would have been if there had been no election and A had made the claim.
(5)If the election relates to only part of the gain on the realisation of an asset treated as occurring under section 780 or 785, Chapter 7 and this section apply as if the realisation treated as occurring had been of a separate asset representing a corresponding part of the asset.
(6)If subsection (5) applies, any necessary apportionments must be made accordingly.
(1)This section applies if—
(a)a company (“A”) is liable to a degrouping charge,
(b)an amount of corporation tax has been assessed on A for the relevant accounting period, and
(c)the whole or part of that amount is unpaid at the end of the period of 6 months after the time when it became payable.
(2)An officer of Revenue and Customs may serve a notice on the persons to whom this subsection applies (see subsections (3) and (4)) requiring them to pay the lesser of—
(a)the amount of corporation tax referable to the degrouping charge (see section 796(2)), or
(b)the amount that remains unpaid of the corporation tax payable for the relevant accounting period by A.
(3)If A was a member of a group at the relevant time, subsection (2) applies to—
(a)a company that was at that time the principal company of the group, and
(b)any other company that at any time in the period of 12 months ending with the relevant time—
(i)was a member of that group, and
(ii)owned the relevant asset or any part of it.
(4)If at the relevant time A is not UK resident but carries on a trade in the United Kingdom through a permanent establishment, subsection (2) applies to any person who is a controlling director—
(a)of A,
(b)of a company that has control of A,
(c)of a company that had control of A within the period of 12 months ending with the relevant time,
or was such a controlling director during that period.
(5)Section 796 applies for the interpretation of this section and in that section references to “A” must be read in accordance with this section.
(1)For the purposes of section 795 and this section—
“the relevant accounting period” is the accounting period in which the degrouping charge falls to be brought into account by A,
“the relevant time” is—
in a case within section 780, when A ceased to be a member of the group,
in a case within section 785, when A ceased to meet the qualifying condition (within the meaning of that section), and
if there has been an election under section 792, the time that would have been the relevant time under paragraph (a) or (b) had there been no such election, and
“the relevant asset” is the asset in respect of which the degrouping charge arises.
(2)For the purposes of section 795 the amount of corporation tax referable to a degrouping charge is the difference between—
(a)the tax in fact payable for the relevant accounting period, and
(b)the tax that would have been payable for that period in the absence of the degrouping charge.
(3)References in section 795 and this section to a degrouping charge are to—
(a)a credit required to be brought into account under section 780(3) or 785(4), or
(b)if there has been an election under section 792, a credit required to be brought into account as a result of the election.
(4)In section 795 and this section—
“director”, in relation to a company—
has the meaning given by section 67(1) of ITEPA 2003 (read with section 67(2) of that Act) and
includes any person falling within section 417(5) of ICTA (read with section 417(6) of that Act),
“controlling director”, in relation to a company, means a director of the company who has control of it, and
“group” and “principal company” have the meaning that would be given by Chapter 8 if in that Chapter for references to 75% subsidiaries there were substituted references to 51% subsidiaries.
(5)In subsection (4) “control” has the meaning given by section 416(2) to (6) of ICTA.
(1)A notice served under section 795(2) may require the payment of the amount required to be paid by the notice within 30 days of the service of the notice.
(2)The notice must state—
(a)the amount of the tax referable to the degrouping charge (within the meaning given in section 796(2)),
(b)the amount of corporation tax assessed on A for the relevant accounting period that remains unpaid,
(c)the date when it first became payable, and
(d)the amount required to be paid by the person on whom the notice is served.
(3)The notice has effect—
(a)for the purposes of the recovery from that person of the amount required to be paid and of interest on that amount, and
(b)for the purposes of appeals,
as if it were a notice of assessment and that amount were an amount of tax due from that person.
(4)A person who has paid an amount required to be paid by a notice under section 795(2) may recover the amount paid from A.
(5)A payment required to be made by such a notice is not allowed as a deduction in calculating any income, profits or losses for any tax purposes.
(6)In this section “A” and “the relevant accounting period” have the same meaning as in section 795 (see section 795(1) and section 796(1) respectively).
(1)A notice under section 795(2) must be served before the end of the period of 3 years beginning with the date on which A's liability to corporation tax for the relevant accounting period is finally determined.
(2)In subsection (1) “A” and “the relevant accounting period” have the same meaning as in section 795 (see section 795(1) and section 796(1) respectively).
(3)If the unpaid tax is charged because of a determination under paragraph 36 or 37 of Schedule 18 to FA 1998 (determination where no return delivered or return incomplete), the date mentioned in subsection (1) is the date on which the determination was made.
(4)If the unpaid tax is charged in a self-assessment, the date mentioned in subsection (1) is the latest of—
(a)the last date on which notice of enquiry may be given into the return containing the self-assessment,
(b)if notice of enquiry is given, 30 days after the enquiry is completed,
(c)if more than one notice of enquiry is given, 30 days after the last notice of completion,
(d)if after such an enquiry an officer of Revenue and Customs amends the return, 30 days after notice of the amendment is issued, and
(e)if an appeal is brought against such an amendment, 30 days after the appeal is finally determined.
(5)If the unpaid tax is charged in a discovery assessment, the date mentioned in subsection (1) is—
(a)if there is no appeal against the assessment, the date when the tax becomes due and payable, and
(b)if there is such an appeal, the date on which the appeal is finally determined.
(6)In this section—
“self-assessment” includes a self-assessment that supersedes a determination as a result of paragraph 40 of Schedule 18 to FA 1998, and
“discovery assessment” means an assessment under paragraph 41(1) of that Schedule.
(1)If a payment for group roll-over relief or for the reallocation of a degrouping charge does not exceed the amount of the relevant relief—
(a)it is not taken into account in calculating profits or losses of either of the companies involved for corporation tax purposes, and
(b)it is not a distribution for any of the purposes of the Corporation Tax Acts.
(2)A payment for group roll-over relief is a payment made—
(a)in connection with a claim for relief under Chapter 7 (roll-over relief in case of realisation and reinvestment) made because of—
(i)section 777 (relief on realisation and reinvestment: application to group member), or
(ii)section 779 (rules that apply to cases within section 778(1)),
(b)by the company whose proceeds of realisation are reduced as a result of the claim,
(c)to a company whose acquisition costs are reduced (in a case within section 777) or the tax written-down value of whose assets is reduced (in a case within section 779) as a result of the claim, and
(d)in accordance with an agreement between those companies in connection with the claim.
(3)A payment for the reallocation of a degrouping charge is a payment made—
(a)in connection with an election under section 792 (reallocation of charge within group),
(b)by the company to which the chargeable realisation gain accrues,
(c)to the company to which as a result of the election the whole or part of that gain is treated as accruing, and
(d)in accordance with an agreement between those companies in connection with the election.
(4)In the case of a payment in connection with such a claim for relief as is mentioned in section 777(3), the amount of the relevant relief is the amount of the reduction, as a result of the claim, in the acquisition costs of the company to which the payment is made.
(5)In the case of a payment in connection with such a claim for relief as is mentioned in section 778(4), the amount of the relevant relief is the amount of the reduction, as a result of the claim, in the tax written-down value of the assets of the company to which the payment is made.
(6)In the case of a payment in connection with an election under section 792, the amount of the relevant relief is the amount treated as a result of the election as accruing to the company to which the payment is made.