Corporation Tax Act 2009 section 819

European cross-border transfers of business: introduction

Section 819 sets out the introductory conditions that must be met for a tax-neutral transfer of intangible assets to apply when a business is transferred cross-border between companies in the UK and EU member states.

• Two alternative scenarios (Condition A and Condition B) can qualify for tax-neutral treatment under section 820, provided both the transferor and transferee companies make a joint claim
• Condition A covers a straightforward transfer of the whole or part of a UK business from a company in one relevant state to a company in another, wholly in exchange for securities
• Condition B covers a partial business transfer (a demerger-type arrangement) where the transferor continues trading afterwards, with at least one transferee in a different relevant state, and consideration takes the form of shares or debentures issued to the transferor's shareholders
• A company qualifies as resident in a relevant state only if it is subject to tax there as a resident and is not treated under any double taxation treaty as resident outside a relevant state