Section 211 | Transfer of assets or liabilities to a member of a multinational group

(1)Subsection (1A) applies where there has been a transfer of assets or liabilities to a member of a multinational group and—^F1

(a)the transfer forms part of a qualifying reorganisation (see section 212), or^F1

(b)the transferor is a member of the group and—^F1

(i)the transferee is located in the same territory as the transferor,^F1

(ii)the transferee and transferor are included in the same tax consolidation group in that territory (within the meaning of section 164(5)), and^F1

(iii)an election under section 164 (election to exclude intra-group transactions) has effect in relation to those members at the time of the transfer.^F1

(1A)The value of the assets or liabilities is, for the purpose of determining the adjusted profits of the member, the carrying value of the assets or liabilities in the hands of the transferor immediately before the transfer.^F1

(1B)Subsection (1C) applies where there has been a transfer of assets or liabilities to a member of a multinational group and subsection (1A) does not apply.^F1

(1C)The value of the assets or liabilities is, for the purpose of determining the adjusted profits of the member, the carrying value of the assets or liabilities immediately after the transfer as determined under the accounting standard used in determining the underlying profits of the member for the purposes of this Part and subject to the adjustments to those profits made in accordance with Chapter 4.^F1

(2)But subsection (3) applies where—

(a)subsection (1C) applies in relation to the transfer,^F2

(b)the transfer is from another member of the group, ...^F3

(ba)the transferor and the transferee are not members of the same type located in the same territory, and^F4

(c)neither a gain nor a loss is recorded in the underlying profits accounts of the transferor in respect of that transfer.

(3)Where this subsection applies the adjusted profits of both the transferor and the transferee are to be adjusted to secure that the transfer is reflected on an arm’s length basis (see section 149(7)).

(4)Where a member of a multinational group transfers assets or liabilities to another entity in the course of a qualifying reorganisation, and recognises a non-qualifying gain or loss as a result of that transfer—

(a)that gain or loss, to the extent it is non-qualifying, is to be included in the adjusted profits of the member, and

(b)where the other entity is a member of a multinational group, the value of the assets or liabilities is, for the purposes of determining the adjusted profits of that member, to be adjusted to exclude the non-qualifying gain or loss in a manner consistent with the tax treatment of the assets or liabilities.

(5)For the purposes of subsection (2) two members of a multinational group are of the same type if—^F5

(a)they are both standard members of the group,^F5

(b)they are both investment entities, or^F5

(c)they are both members of the same minority subgroup (see section 228).^F5