Taxation of Chargeable Gains Act 1992 section 217A

Transfer of assets on incorporation of registered friendly society

Section 217A ensures that when a registered friendly society incorporates under the Friendly Societies Act 1992, the transfer of assets to the newly incorporated society takes place on a no gain/no loss basis for corporation tax on chargeable gains purposes.

• The section applies whenever a registered friendly society incorporates under the Friendly Societies Act 1992, with the society before incorporation termed "the registered society" and after incorporation termed "the incorporated society".
• Assets transferred from the registered society to the incorporated society under the statutory incorporation process are deemed to be disposed of and reacquired at a value that produces neither a gain nor a loss.
• The no gain/no loss treatment also extends to assets held by branches of the registered society that are transferred to or identified in a scheme relating to the incorporated society.
• This provision works alongside section 217B, which deals with the rights of members in the registered society being equated with rights in the incorporated society.