D1.611A Market value rule for intangible assets transfers
Where there is a transfer of a 'chargeable intangible asset' from a company to a related party, or vice versa, the transfer is treated for all tax purposes as taking place at market value, regardless of the actual consideration for the transfer1.
A chargeable intangible asset is essentially an asset within the computational rules of the corporate intangible regime.
Where there is a grant of a licence or other right in respect of a chargeable intangible asset by a company to a related party, or vice versa, on or after 22 November 2017, similar market value treatment applies to the grant (other than grants made pursuant to an obligation under a contract which was unconditional before that date)2. An obligation is treated as unconditional for these purposes if it could not be varied or extinguished by the exercise of a right (whether under the contract or otherwise)3.This market value rule does not apply to a restricted asset to which CTA 2009 s 900F applies (see the 'restricted assets' section at D1.608)4.
For the meaning of 'related party', see D1.601B. The references to a related party for times on or after 25 November 2015 include references to the