Commentary

D1.608 Pre-FA 2002 intangible assets and transitional provisions

Corporate tax
Corporate tax | Commentary

D1.608 Pre-FA 2002 intangible assets and transitional provisions

Corporate tax | Commentary

D1.608 Pre-FA 2002 intangible assets and transitional provisions

Where an asset does not fall to be taxed under the corporate intangible regime rules because it was acquired or created before 1 April 2002, it is referred to as a 'pre-FA 2002 asset'1. The rules under which a pre-FA 2002 asset fall to be taxed are referred to as the 'law as it was before 1 April 2002'2. The treatment of the disposal of pre-FA 2002 assets and rollover relief is detailed in D1.641.

Anti-avoidance provisions were put in place when the corporate intangible regime was introduced to prevent pre-FA 2002 assets from being brought within the scope of the regime as a result of direct or indirect transfers between related parties. Two arrangements were prescribed.

The first situation is where company acquires an intangible fixed asset on or after 1 April 2002 and before 30 June 2020 from a person (the transferor) who at the time of acquisition was a related party in relation to the company and the asset was created on or after 1 April 2002. Then if the value of the asset is derived in whole from another asset (see below) which was a pre-FA 2002 asset in the hands of3:

  1.  

    •     the transferor at a time when it was connected with the company, or

  2.  

    •     another person at a time when that other person was a related party in relation to the company or the transferor

the asset is itself treated as a pre-FA 2002 asset.

In such cases where

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