Section 996 — Corporation Tax Act 2010: Use of different accounting practices within a group of companies

Use of different accounting practices within a group of companies 996 1 Subsection (2) applies if—

a a company (“company A”) prepares accounts in accordance with international accounting standards, b another company (“company B”) in the same group of companies prepares accounts in accordance with UK generally accepted accounting practice, c there is a transaction between, or a series of transactions involving, company A and company B, and d a tax advantage would (apart from this section) be obtained by either or both of those companies in relation to the transaction or series of transactions as a result of the use of different accounting practices.

2 The Tax Acts apply in relation to the transaction or series of transactions as if both company A and company B prepared accounts in accordance with UK generally accepted accounting practice.

3 Section 170(3) to (6) of TCGA 1992 apply to determine for the purposes of this section whether companies are in the same group of companies.

4 None of the following circumstances (individually or in combination) prevents a series of transactions from being a series of transactions involving company A and company B—

a there is no transaction in the series to which both those companies are parties, b the parties to any arrangements in pursuance of which the transactions in the series are entered into do not include one or both of those companies, c there are one or more transactions in the series to which neither of those companies is a party.

5 In this section “ tax advantage ” has the meaning given by section 1139.