Taxes Consolidation Act 1997 section 835HA

Interaction with capital allowances provisions

Section 835HA sets out the circumstances in which the transfer pricing rules in section 835C do not apply to the computation of capital allowances and balancing allowances or charges, and provides for the interaction between those rules and the capital allowances provisions.

• Transfer pricing rules do not apply to capital allowances where the capital expenditure on the asset acquired does not exceed €25 million, or where the market value of the asset at the time of a balancing event does not exceed €25 million.
• Transfer pricing rules are also disapplied where specified reliefs in the Act treat the asset as having been transferred at an amount other than market value or the arm's length amount, including joint elections under section 289(6) or section 312(5)(a), trade transfers, EU mergers, building society conversions, and trustee savings bank transfers.
• Where assets that once formed part of the same asset are acquired or disposed of under separate arrangements as part of a scheme to avoid the €25 million threshold, the expenditure or market value of all such assets is aggregated for the purposes of determining whether the threshold is exceeded.
• Where the transfer pricing rules do apply, they take precedence over the market value rules in the capital allowances provisions, but will not apply if doing so would result in higher allowances or a lower balancing charge than would arise under those provisions.