The Degrouping Rules and the Subgroup Exception – what does the legislation say?

 Corporate Groups, Corporate Tax, IP Tax  Comments Off on The Degrouping Rules and the Subgroup Exception – what does the legislation say?
Aug 232013
 

In our last article on corporate groups, we looked at the subgroup exception as it applies to intra-group transfers. We showed, using both numerical and visual examples, why there should be an exception. In this article we shall see how the tax legislation ensures that this is indeed the case. As before, we shall be concentrating on the rules for capital assets – the rules for IP are similar. Continue reading »

The Degrouping Rules and the Subgroup Exception – an Overview

 Corporate Groups, Corporate Tax, IP Tax  Comments Off on The Degrouping Rules and the Subgroup Exception – an Overview
May 062013
 

As has been stated in previous articles, the degrouping rules are designed to prevent assets from being smuggled out of a group tax free under the protection of a corporate wrapper. This is achieved by imposing a tax liability when a company acquires an asset from a fellow group member and subsequently leaves the group within the next 6 years. 

But for every rule, there is an exception. Continue reading »

Corporate Groups and the Degrouping Rules – Comparing Capital Gains and IP Groups

 Corporate Groups, Corporate Tax, IP Tax  Comments Off on Corporate Groups and the Degrouping Rules – Comparing Capital Gains and IP Groups
Apr 222013
 

We have seen in previous articles how the degrouping rules operate to prevent the use of a corporate vehicle to shelter taxable gains. There are two sets of rules, one for capital assets and the other for intangibles (“IP”). In this article we shall look at how these rules differ, giving a specific example involving a business sale.

(This article can be downloaded in pdf format at Academia.edu.)

Continue reading »

Corporate Tax Groups – Degrouping IP

 Corporate Groups, Corporate Tax, IP Tax  Comments Off on Corporate Tax Groups – Degrouping IP
Apr 212013
 

In this article, we shall discuss the degrouping rules as they apply to intangible assets such as IP and goodwill (collectively referred to as IP). The tax treatment is similar to that applying to capital assets, but with important differences.

(This article can be downloaded in pdf format at Academia.edu.) Continue reading »

Corporate Tax Groups – Intra-group Transfers are Tax Neutral

 Corporate Groups, Corporate Tax  Comments Off on Corporate Tax Groups – Intra-group Transfers are Tax Neutral
Mar 112013
 

This is the second in a series of articles in which we explore the tax rules applying to intra-group transactions. In the first article we looked at the basic definition of a corporate group as it applies to the capital gains tax and IP legislation. We shall now see how the legislation ensures that intra-group transactions are tax neutral.

(This article can be downloaded in pdf format at Academia.edu.) Continue reading »

Introducing Corporate Tax Groups

 Corporate Groups, Corporate Tax  Comments Off on Introducing Corporate Tax Groups
Mar 062013
 

This is the first in a series of articles in which we explore the tax rules applying to intra-group transactions. The basic proposition is that such transactions are tax neutral. This reflects the idea that a corporate group represents a single economic unit – when assets are transferred between members, ownership remains within the same family. Accordingly no tax is charged until such time that the asset leaves the group.

In this first article, we shall give an overview of what a corporate group looks like. Later articles will look at the actual rules governing intra-group transfers.

(This article can be downloaded in pdf format at Academia.edu.) Continue reading »