Corporation Tax Act 2010 section 210A

Acquisition value of qualifying investments

Section 210A defines how to determine the acquisition value of a qualifying investment when a company disposes of it to a charity, for the purposes of calculating the net benefit to the charity under the charitable donations relief rules.

• Where a company disposes of a qualifying investment it acquired within the four years before the disposal, the acquisition value is the cost the company paid to acquire it.
• Where the investment derives from or represents something else the company acquired within that four-year window, the acquisition value is a just and reasonable proportion of the cost of acquiring that original asset.
• The cost of acquisition means the consideration the company gave for the acquisition, reduced by any amount received back by the company or a connected person as part of the same scheme.
• These rules ensure that the acquisition value used in calculating charitable donations relief accurately reflects the genuine economic cost to the company, net of any related receipts.