Corporation Tax Act 2009 section 629

Avoidance relying on continuity of treatment provisions: transactions before 16 May 2008

Section 629 disapplies the group continuity rules for derivative contracts where a transferor is party to a tax avoidance arrangement involving a subsequent transfer by the transferee, but this anti-avoidance rule does not apply to transactions that took place before 16 May 2008.

• Section 625 provides continuity of treatment when derivative contracts are transferred between companies in the same group.
• Section 629 is an anti-avoidance rule that removes this continuity treatment where the transferor was involved in an avoidance scheme that also involved a later transfer by the transferee.
• This transitional provision protects transactions that took place, or series of transactions where the first transaction took place, before 16 May 2008 from the reach of Section 629.
• If the first transaction in a series occurred before 16 May 2008, the entire series is outside the scope of the anti-avoidance rule, even if later transactions in that series occurred on or after that date.