Taxation of Chargeable Gains Act 1992 Schedule 7AC paragraph 15A

Effect of transfer of trading assets within a group

Section 15A provides a rule that extends the period for which an investing company is treated as holding a substantial shareholding where trading assets have been transferred within a group prior to a share disposal.

• Where a group transfers trading assets into a subsidiary before selling that subsidiary's shares, the time the assets were used in trade by another group member can count towards the 12-month substantial shareholding requirement
• The rule applies only if the investing company already holds a substantial shareholding immediately before the disposal and the transferred asset is being used in a trade by the investee company at the time of disposal
• All relevant companies — the investee, the investing company, and any other company that transferred the asset — must have been members of the same group at the time of the asset transfer
• The definition of "trade" for the purposes of this rule includes oil and gas exploration and appraisal activities