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HMRC internal manual

Capital Gains Manual

Company reconstructions: company becoming approved investment trust


TCGA92/S139 could apply to a company which was not an approved investment trust at the time of the transfer. If the transferee company subsequently became an approved investment trust any gain on the disposal of the transferred assets would be lost. This possibility is dealt with by TCGA92/S101.

TCGA92/S101 applies if the transferee company still owns any of the transferred assets at the beginning of the accounting period in which it becomes an approved investment trust. The transferee company is treated as though it sold and immediately reacquired the transferred assets at their market value immediately after the transfer.

Assessments can be made within six years of the accounting period in which the company became an approved investment trust. TCGA92/S101 also allows you to make further assessments and adjust settled liabilities.


Section 101 does not apply to a company if at the time it becomes an investment trust it has previously been a Venture Capital Trust and TCGA92/S101 B has applied to the assets concerned. This is because Section 101B, see CG52830, has the same general effect as Section 101.