Taxation of Chargeable Gains Act 1992 Schedule 3 paragraphs 8–9

Elections under section 35(5): groups of companies

Section 35(5) rebasing elections within groups of companies: paragraphs 8 and 9 of Schedule 3 set out rules governing how the election to treat all assets as having a base cost equal to their 31 March 1982 value applies when the company making the election is part of a group.

• Only the principal company of a group may make a section 35(5) rebasing election, and that election automatically extends to every other company that is a member of the group at the "relevant time".
• A subsidiary that was not in the group at the relevant time may make its own independent election, but a subsidiary that was already a group member at that time cannot elect separately.
• The "relevant time" is the earliest of: the first qualifying disposal by a current group member (excluding outgoing companies), an incoming company joining the group, or the date the principal company makes the election.
• Special rules protect companies that joined or left the group at particular times — an outgoing company that left before the election was made is not bound by it, and an incoming company that had already used up its own election window is unaffected.

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