Corporation Tax Act 2010 section 695

Notional split of accounting period in which change in ownership occurs

Section 695 explains how the accounting period in which a company changes ownership is split into two notional accounting periods for the purposes of restricting certain reliefs.

• When a change in ownership occurs partway through an accounting period, that period is treated as two separate notional accounting periods for the purposes of this Chapter.
• The first notional accounting period runs from the start of the actual accounting period up to and including the date of the ownership change.
• The second notional accounting period covers the remainder of the actual accounting period after the change.
• Relevant amounts for the actual accounting period must be apportioned between the two notional periods in accordance with the rules set out in section 702.