Corporation Tax Act 2009 section 772

Equity holders and profits or assets available for distribution

Section 772 applies the group relief rules on equity holders and the distribution of profits or assets to the intangible fixed assets grouping provisions, with certain modifications.

• The rules in CTA 2010 Chapter 6 of Part 5 (which define equity holders and how profits or assets available for distribution are measured) are imported for use in determining group membership for intangible fixed assets purposes under sections 768 and 771.
• A bank that lends money to a company in the ordinary course of its banking business is not treated as a loan creditor (and therefore not an equity holder) of that company, even though it holds loan capital or debt from the company.
• Several supplementary provisions of CTA 2010 dealing with temporary share rights, option arrangements, and assets referable to a UK trade are switched off — specifically sections 171(1)(b) and (3), 173, 174, and 176 to 182 are treated as omitted.
• The effect is to apply a simplified version of the equity holder and profit-distribution tests when deciding whether companies form a group for intangible fixed assets purposes.