Corporation Tax Act 2009 section 630

Introduction to sections 631 and 632

Section 630 sets out when the "de-grouping" rules in sections 631 and 632 are triggered where a company that received a derivative contract through an intra-group transfer subsequently leaves the group within six years.

• Where a derivative contract was transferred within a group under the continuity-of-treatment rules, and the receiving company (the transferee) leaves the group within six years while still holding that contract, sections 631 and 632 impose a deemed assignment of the contract at market value
• The six-year clock starts from the date of the transfer transaction or, if there was a series of transactions, from the date of the last transaction in the series
• If the transferee leaves the group as a consequence of a European cross-border transfer of business or merger, it is not treated as having left the group for these purposes — and if it joins a new group as a result, the old and new groups are treated as the same group
• Key definitions — "the relevant derivative contract" is the contract originally transferred, "the relevant group" is the group in which the transfer took place, and "the transferee" is the company that received the contract