Corporation Tax Act 2010 section 580

Effects of cessation: CAA 2001

Section 580 modifies how capital allowances rules operate when a company or group leaves the UK REIT regime, ensuring that the deemed sale and reacquisition of assets does not create unintended capital allowance consequences.

• The deemed sale and reacquisition of assets on leaving the REIT regime does not give rise to any capital allowances or balancing charges under CAA 2001.
• No election can be made under sections 198 or 199 of CAA 2001 to apportion the deemed sale price in respect of fixtures.
• The special deemed consideration rules in section 579(5) do not apply for capital allowances purposes, preserving the existing capital allowances history of the assets.
• Any capital allowances actions taken before cessation in relation to the property rental business are treated as having been done by or to the post-cessation company, ensuring continuity.