# Corporation Tax Act 2010, Section 1066: Exception for certain transfers between UK resident companies


(1) Section 1064 does not apply if the company and the participator are both UK resident and—
(a) one is a 51% subsidiary of the other or both are 51% subsidiaries of a third company which is also UK resident, and
(b) the benefit to the participator arises on a transfer of assets or liabilities—
(i) by the company to the participator, or
(ii) to the company by the participator,
or in connection with such a transfer.
(2) In determining whether one body corporate (“A”) is a 51% subsidiary of another (“B”) for the purposes of subsection (1), B is treated as not being the owner of—
(a) any share capital which it owns directly in a body corporate as trading stock,
(b) any share capital which it owns indirectly, and which is owned directly by a body corporate as trading stock, or
(c) any share capital which it owns directly or indirectly in a body corporate that is not UK resident.
(3) For the purposes of subsection (2) share capital owned by a body is owned as trading stock if (and only if) a profit on the sale of the shares would be treated as a trading receipt of the body's trade.

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Source: https://www.legislation.gov.uk/ukpga/2010/4/section/1066 (the official version)
Page: https://openlegislation.uk/corporation-tax-act-2010/section-1066
Contains public sector information licensed under the Open Government Licence v3.0. Source: legislation.gov.uk, The National Archives.