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HMRC internal manual

Capital Gains Manual

Share identification rules for corporation tax: disposals within the prescribed period (applies to disposals before 5 December 2005)

TCGA92/S106 provided a type of “bed and breakfast” rule that matched share disposals with acquisitions during a “prescribed period”. The rule was repealed by FA06/S72 and cannot apply to disposals on or after 5 December 2005. It was repealed as part of a package of measures that included the introduction of a number of Targeted Anti Avoidance Rules (TAARs).

Contrived losses that are created by the sale and subsequent reacquisition of shares of the same class in the same company that are held in the same capacity may now be countered by the application of TAAR 1. For more guidance on the application of this rule please see CG40240 onwards.

This guidance was revised in 2014 and the detailed rules on the operation of TGCA92/S106 are no longer included. If you need to consider the deleted guidance then this is available from commercial tax information packages or directly from Capital Gains Technical Group.