Associated timing

A dispute arose between HMRC and the taxpayer over the taxpayer's corporation tax liability on gains accruing as a result of transfers between associated companies under TCGA 1992 s 179. The issue was whether the parties had to be associated at the time of the acquisition as well as when they left the group.

The taxpayer's appeal had failed both before the Special Commissioner and the High Court.

The Court of Appeal said that a proviso in s 179 required that not only should companies be associated when leaving the group but also that they should have been associated companies when the one acquired from the other the relevant asset. HMRC were correct in their reading of the second limb of s 179(2).

The taxpayer's appeal was dismissed.

In essence says Tenon's Pete Miller the court found for HMRC on the simple ground that the word...