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HMRC internal manual

Double Taxation Relief Manual

Non-residents: UK income: Charge on deemed disposals

In 1989 provisions were introduced both for companies and individuals. There is now a charge - in TCGA92/S25 - on accumulated gains when the branch or agency ceases to trade. There is also a charge when assets are transferred abroad whilst the branch or agency continues to trade. In both cases the assets are deemed to be disposed of and immediately re-acquired at their market value immediately before the relevant event. Until 30 November 1993 it was necessary to have a corresponding provision in TCGA92/S188 to create an occasion of charge when a treaty non-resident company (see CT3394) closed down a permanent establishment in the United Kingdom or took an asset out of the establishment so that the United Kingdom lost the right to charge gains on a future disposal.