Corporation Tax Act 2009 section 898

Relief where assets disposed of on or after 1 April 2002

Section 898 extends roll-over relief to disposals of pre-Finance Act 2002 intangible fixed assets that remain within the capital gains tax regime, allowing the proceeds to be reinvested in new intangible assets under the Corporation Tax Act 2009 rules.

• When a company disposes of a pre-Finance Act 2002 intangible asset on or after 1 April 2002, roll-over relief under Chapter 7 of Part 8 can apply, treating the disposal as if it were a realisation under the intangible fixed assets regime
• Net proceeds of disposal are calculated as the consideration received less any allowable incidental costs of disposal, and the cost of the old asset is the net proceeds minus the chargeable gain
• The amount available for roll-over relief reduces both the consideration the company is treated as receiving for capital gains purposes and the tax cost of the new replacement asset
• The related party exclusion from roll-over relief in section 850 does not apply where the disposal qualifies for relief under this section