Corporation Tax Act 2010 section 692

Introduction to Chapter

Section 692 sets out the conditions that must be met for the Chapter to apply, restricting relief where there is a change in ownership of a company with investment business and certain asset transfers and gains arise within a five-year window.

• The Chapter applies when there is a change in ownership of a company with investment business and specified conditions are satisfied — specifically Condition 1 together with either Conditions 2 and 3 or Condition 4
• Condition 1 requires that none of the disqualifying conditions set out in section 677 are met; Condition 2 requires that, after the ownership change, the company acquires an asset from another group company on a no-gain/no-loss or tax-neutral basis
• Condition 3 requires that within five years of the ownership change, a chargeable gain arises on disposal of the asset, or a non-trading chargeable realisation gain arises on realisation of an intangible fixed asset; Condition 4 applies where a chargeable gain is allocated to the company by election within five years immediately after the ownership change
• An asset acquired by the company is treated as the same as a later asset if the later asset's value derives wholly or partly from the original — for example, where the company held a leasehold and subsequently acquired the freehold reversion