CIRD10160 - Intangible assets: introduction: related parties
Source: gov.uk (2025-10-24)


Broadly speaking, related parties are those within the same economic family. Given the shared interests between related parties there is often more scope for transactions to be structured in the most beneficial way for tax. There may not be the same commercial constraints in place as there would be where the parties to a transaction are fully independent of each other. For that reason the intangible asset rules are modified in certain respects where related parties are involved. There is a separate definition of related parties that differs from the more familiar one for connected persons. The related party rules are covered in more detail at CIRD45000 (https://www.gov.uk/hmrc-internal-manuals/corporate-intangibles-research-and-development-manual/cird45000) onwards.

The general rules in CTA09/PART8 are modified for transactions between related parties as follows:
- Pre-FA 2002 assets purchased from related parties before 1 July 2020 remain outside the regime.
- Related party acquisitions involving pre-FA 2002 acquired on or after 1 July 2020 may be "restricted assets". See CIRD46000 (https://www.gov.uk/hmrc-internal-manuals/corporate-intangibles-research-and-development-manual/cird46000) onwards.
- Where intangible assets within the provisions of Part 8 are transferred between related parties then the transaction is usually deemed to take place at market value (but see CIRD10190 (https://www.gov.uk/hmrc-internal-manuals/corporate-intangibles-research-and-development-manual/cird10190) about groups of companies).
- Where royalties are payable to a related party who is not subject to Part 8, and the royalties are paid more than twelve months after the period in which they are charged against profits, then the tax deduction is deferred until the period in which payment is made. See CIRD12660 (https://www.gov.uk/hmrc-internal-manuals/corporate-intangibles-research-and-development-manual/cird12660).
- There is no reinvestment relief for gains arising on part disposals to related parties. CIRD20080 (https://www.gov.uk/hmrc-internal-manuals/corporate-intangibles-research-and-development-manual/cird20080) explains the reasons.
- Where an individual, or a firm incorporates their business on or after 3 December 2014 and before 8 July 2015, the FA15 'relevant asset' rules apply and amortisation etc. relief for goodwill and certain customer related intangible assets may be restricted. See CIRD44000 (https://www.gov.uk/hmrc-internal-manuals/corporate-intangibles-research-and-development-manual/cird44000) onwards.
- Where an individual, or a firm incorporates their business on or after 1 April 2019, the FA19 rules apply. A similar restriction to the FA15 rule applies to related party incorporations. See CIRD44083 (https://www.gov.uk/hmrc-internal-manuals/corporate-intangibles-research-and-development-manual/cird44083).
- The FA19 rules also apply restrictions where a company acquires a Pre-FA 2019 relevant asset from a related party. See CIRD44075 (https://www.gov.uk/hmrc-internal-manuals/corporate-intangibles-research-and-development-manual/cird44075) onwards.
Point to note

There is no amortisation etc. relief for goodwill and certain customer related intangible asset for acquisitions on or after 8 July 2015 and before 1 April 2019, whether from a related or unrelated party. See CIRD44300 (https://www.gov.uk/hmrc-internal-manuals/corporate-intangibles-research-and-development-manual/cird44300) onwards for the F2A15 rules.