Taxation of Chargeable Gains Act 1992 section 276A

No gain/no loss: foreign permanent establishment exemption

Section 276A adjusts the way no gain/no loss disposal values are calculated when the transferring company has elected for the foreign permanent establishment exemption, so that the exempt portion of any future gain or loss on the asset is properly preserved.

• When a company that has opted into the foreign branch exemption makes a no gain/no loss disposal, the deemed consideration must be worked out after taking account of the branch exemption rules in Chapter 3A of Part 2 of the Corporation Tax Act 2009.
• The effect is that the no gain/no loss value includes the foreign permanent establishments amount that would have been attributable to the disposal if it had been a normal (non no gain/no loss) disposal.
• This adjustment applies regardless of whether the company acquiring the asset has itself opted into the branch exemption.
• A no gain/no loss disposal for these purposes means one where, under rollover relief (section 152) or any of the statutory no gain/no loss provisions, neither a gain nor a loss accrues to the company making the disposal.