CIRD40560 - Intangible assets: groups: degrouping: principal company becoming member of another group: subsequent restoration of degrouping adjustment - HMRC internal manual - GOV.UK

As mentioned in CIRD40550, there are occasions when the transferee company can be exposed to a degrouping adjustment when it ceases to be controlled by a member of the enlarged group (as

explained in the last sub-paragraph of CIRD40550). The conditions are:

For the purposes of these conditions, a company P is a ‘relevant subsidiary’ of another company Q if, but for sections 767 to 770 CTA09, it would be a member of a group of which company Q

would be the principal company

The resulting aggregate credit or debit is treated as though it arose immediately prior to the company having ceased to be a relevant subsidiary of a company in the second group (the second

condition above). The rules described in the last sub-paragraph of CIRD40520 determine how the credit or debit is classified in the company’s CT computation.