CIRD45260 - Intangible assets: related party rules: partnership incorporation of a pre-FA 2002 business: outline
BAI receive a number of requests for technical advice in relation to the application of the related party rules at CTA09/PART8/S835 on the incorporation of a pre-FA 2002 partnership business.
Rules were introduced by FA15 which applied from 3 December 2014 to 7 July 2015, and FA19 which apply from 1 April 2019, that restrict when and how relief is given for goodwill recognised on incorporation of a business (see CIRD44001 onwards). No relief was available for goodwill acquired between 8 July 2015 and 31 March 2019. This guidance is therefore only likely to be relevant to goodwill acquired in respect of incorporations that occurred before 3 December 2014.
The term 바카라 사이트渞elated party바카라 사이트� is defined by S835 (see CIRD45105). S835 (5) is relevant to partnership incorporations and you will need to consider the definition of 바카라 사이트渃lose company바카라 사이트�, 바카라 사이트減articipator바카라 사이트� & 바카라 사이트渁ssociate of a participator바카라 사이트� (see CIRD45250).
When a partnership transfers the partnership business to a close company, at a time when one of the partners is also a participator or associate of a participator in that company, the transfer is likely to be between related parties.
A common misconception is that the goodwill can somehow be apportioned between the partners so that only part of the goodwill is treated as a 바카라 사이트減re-FA 2002 asset바카라 사이트� (see CIRD10140). For example, claims are made in relation to an outgoing partner바카라 사이트檚 share of goodwill on the basis that the outgoing partner is not a 바카라 사이트渞elated party바카라 사이트� at the time of acquisition.
For practical advice in relation to such arguments see CIRD45265. CIRD45270 provides advice in relation to information and document requests.