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HMRC internal manual

Company Taxation Manual

Particular bodies: registered societies: conversion to a Companies Act company

Where a registered society converts to a Companies Act company under  CCBS14/S112, this does not cause one entity to cease and another to come into being.  They are treated as the same entity both before and after the conversion.  Clearly however the entity, from the date of conversion, will no longer be treated as subject to the various special provisions applying to registered societies.

Such a conversion does not give rise to any deemed or actual disposal of chargeable assets by either the society or its members, or the receipt of any income.  However, the provisions of TCGA92/S126 to S130 (reorganisation of share capital) should be borne in mind (CG51700 onwards).

It follows that where a registered society is a principal member of a group, a conversion will not stop it being the principal member of that group.  Furthermore, where the registered society had acquired an asset in an intra-group transaction, the conversion will not lead to an occasion of charge for CG purposes.