Commentary

D1.8104 European Community cross border transfers

Corporate tax
Corporate tax | Commentary

D1.8104 European Community cross border transfers

Corporate tax | Commentary

D1.8104 European Community cross border transfers

Transfer of a UK business

Where the whole or part of a UK business is transferred between companies which are resident in the UK or an EU member state, any assets or liabilities in respect of a derivative contract so transferred shall (if certain conditions are met, and both parties make a claim1), be treated for UK tax purposes as if they are transferred between the transferor and transferee companies for a consideration equal to what would have been the carrying value of the derivative contract transferred had a period of account of the transferor ended immediately before the date that the transferor ceased to be a party to the contract2.

As for cross border mergers (D1.8103), where the transferor accounts for a derivative contract using a fair value basis of accounting the transferor is deemed to have disposed of the derivative contract at its fair value at the date at which the transferee becomes a party to that derivative contract. The transferee in turn is deemed to have become a party to the derivative contract for the same consideration3.

The equivalent provisions on the transfer of intangible assets and loan

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