Wholly and exclusively: companies: group service company
S54 Corporation Tax Act 2009, Part 4 Taxation (International and Other Provisions) Act 2010 (TIOPA 2010)
Accept a reasonable recharge regime
Where a group service company incurs management expenses such as a central payroll, you may accept their being recharged to group members on a reasonable basis such as by reference to the number of employees in each company. In effect, each company will then bear the proportion of expenses which relates to its own trade. You should normally only investigate such arrangements where one company incurs the expenditure for the purposes of another that is outside the scope of UK tax.
The transfer-pricing code can be found in Part 4 TIOPA 2010. See INTM410000 onwards and INTM440000onwards for detailed guidance on transfer pricing.
Similar considerations apply to partnerships that have dealings with service companies owned by the partners.