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HMRC internal manual

Capital Gains Manual

From:
HM Revenue & Customs
Published
12 March 2016
Updated:
20 May 2026 - See all updates

CG45970 - Groups: alternative tax collection rights

Section 190 of the Taxation of Chargeable Gains Act (TCGA) 1992

There are extended recovery provisions in section 190 TCGA 1992 to deal with cases in which group companies fail to pay tax liabilities, see CG45973. For guidance on how the recovery provisions apply to liabilities of a non-UK resident company in respect of its UK permanent establishment see CG42160.

For periods up to 31 March 2000, section 190 TCGA 1992 also provides a more general right to recover unpaid tax on chargeable gains from other group companies. The tax can be recovered either from the principal company or from other specified members of the group. The provision applies if any Corporation Tax assessed on a group company for an accounting period in which a chargeable gain accrues is not paid within six months from

  • the date the tax becomes payable
  • or the date the assessment is made if later, but only where the chargeable gain accrues in an accounting period ending on or after 1 October 1993.

Where tax on chargeable gains is included in the unpaid Corporation Tax you may assess, within two years of the date so determined,

  • the principal company of the group at the time the gain accrued, or
  • any other company which in the two years ending with the time the gain accrued was a member of the group and owned the asset disposed of or any part of it. If the asset is an interest in or right over another asset, the provision extends to any part of either asset.

Finance Act 2011 changes the way the degrouping charge in section 179 TCGA 1992 operates in certain circumstances. Where a degrouping charge results in an adjustment to the consideration on a share disposal under section 179(3D) TCGA 1992 then the asset referred to above will be the holding of shares, rather than the asset that is subject to the deemed disposal (and reacquisition) under section 179(3) TCGA 1992.

For gains accruing before 1 April 2000, assessing instructions are in AC3370. A company assessed under the extended recovery provisions is entitled to recover all or part of the tax from other group companies.