Corporation Tax Act 2009 section 249

Acquisition of business: receipts from transferor's UK property business

Section 249 deals with how income is taxed when a UK property business is transferred from one person to another and the new owner receives sums that originally arose under the old owner's business.

• When a person permanently ceases a UK property business and transfers the right to receive business income to a new owner who continues the business, any sums received by the new owner that were not already taxed in the old owner's accounts are taxable as part of the new owner's property business profits.
• The sums are brought into account for the accounting period in which the new owner actually receives them, not the period in which they originally arose.
• These transferred receipts are treated as normal trading income of the new owner's UK property business, rather than being subject to the separate post-cessation receipts rules.
• The rule applies regardless of whether the original business was within the charge to corporation tax or income tax, ensuring consistent treatment when a property business changes hands.