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HMRC internal manual

Capital Gains Manual

HM Revenue & Customs
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Groups: alternative tax collection rights

For periods up to 31 March 2000, TCGA92/S190 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.

FA2011 changes the way the degrouping charge in TCGA92/S179 operates in certain circumstances. Where a degrouping charge results in an adjustment to the consideration on a share disposal under TCGA92/S179(3D) 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 TCGA92/S179(3).