Corporation Tax Act 2010 section 779B

Relevant amount to be treated as income

Section 779B sets out how the relevant amount arising from a disposal of assets through a partnership is taxed as income of the transferor, including the timing of that income and the interaction with other anti-avoidance provisions covering disposals of income streams through partnerships.

• The relevant amount is taxed as income of the transferor for corporation tax purposes, in the same way and to the same extent as the underlying receipts would originally have been taxable
• The timing of when this deemed income is treated as arising follows the rules used for transfers of income streams, adapted so that references to transferring a right are read as references to disposing of the transferred asset
• Where both this Chapter (Chapter 4, dealing with disposals of assets through partnerships) and Chapter 1A (dealing with disposals of income streams through partnerships) could apply to the same disposal, a priority rule determines which takes precedence
• If Chapter 1A would produce the same or a greater amount of taxable income for the transferor, then Chapter 4 does not apply, ensuring the transferor is subject to the higher or equal charge but is not taxed twice on the same disposal