Taxation of Chargeable Gains Act 1992 (c. 12)

Part VI U.K. Companies, oil, insurance etc.

Chapter I U.K. Companies

Non-resident and dual resident companies U.K.

185 Deemed disposal of assets on company ceasing to be resident in U.K. U.K.

(1) This section [F1 applies] to a company if, at any time (“the relevant time”), the company ceases to be resident in the United Kingdom.

(2) The company shall be deemed for all purposes of this Act—

(a) to have disposed of all its assets, other than assets excepted from this subsection by subsection (4) below, immediately before the relevant time; and

(b) immediately to have reacquired them,

at their market value at that time.

(3) Section 152 shall not apply where the company—

(a) has disposed of the old assets, or of its interest in those assets, before the relevant time; and

(b) acquires the new assets, or its interest in those assets, after that time,

unless the new assets are excepted from this subsection by subsection (4) below.

(4) If at any time after the relevant time the company carries on a trade in the United Kingdom through a [F2 permanent establishment]—

(a) any assets which, immediately after the relevant time, are situated in the United Kingdom and are used in or for the purposes of the trade, or are used or held for the purposes of the [F2 permanent establishment], shall be excepted from subsection (2) above; and

(b) any new assets which, after that time, are so situated and are so used or so held shall be excepted from subsection (3) above;

and references in this subsection to assets situated in the United Kingdom include references to exploration or exploitation assets and to exploration or exploitation rights.

[F3 (4A) Subsection (4) applies to an overseas life insurance company in the case of its long-term business with—

(a) the omission from paragraph (a) of the words “are situated in the United Kingdom and”; and

(b) the omission from paragraph (b) of the words “are so situated and”.]

(5) In this section—

(a) “designated area”, “exploration or exploitation activities” and “exploration or exploitation rights” have the same meanings as in section 276;

(b) “exploration or exploitation assets” means assets used or intended for use in connection with exploration or exploitation activities carried on in the United Kingdom or a designated area;

(c) “the old assets” and “the new assets” have the same meanings as in section 152;

and a company shall not be regarded for the purposes of this section as ceasing to be resident in the United Kingdom by reason only that it ceases to exist.

Textual Amendments

F1 Word in s. 185(1) substituted (with effect in accordance with Sch. 8 para. 9(5) of the amending Act) by Finance Act 2019 (c. 1), Sch. 8 para. 9(3)

F2 Words in s. 185(4) substituted (with effect in accordance with s. 153(4) of the amending Act) by Finance Act 2003 (c. 14), s. 153(1)(b)

F3 S. 185(4A) inserted (17.7.2012) by Finance Act 2012 (c. 14), Sch. 16 para. 78

Modifications etc. (not altering text)

C1 S. 185 excluded (27.7.1999) by Commonwealth Development Corporation Act 1999 (c. 20), Sch. 3 paras. 1, 3(4)

C2 Ss. 170-192 restricted (27.7.1999) by Commonwealth Development Corporation Act 1999 (c. 20), Sch. 3 paras. 1, 4(1)

F4 186 Deemed disposal of assets on company ceasing to be liable to U.K. taxation. U.K.

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Textual Amendments

F4 S. 186 repealed (with effect in accordance with s. 251(1)(a)(9) of the amending Act) by Finance Act 1994 (c. 9), s. 251(9), Sch. 26 Pt. VIII(1)

F5 187 Postponement of charge on deemed disposal under section 185 or 186. U.K.

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Textual Amendments

F5 S. 187 repealed (with effect in accordance with Sch. 8 para. 9(5) of the amending Act) by Finance Act 2019 (c. 1), Sch. 8 para. 9(1)

F6 187A Deemed disposal under section 185: ATED-related gains and losses U.K.

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Textual Amendments

F6 S. 187A omitted (with effect in accordance with Sch. 1 paras. 120, 123 of the amending Act) by virtue of Finance Act 2019 (c. 1), Sch. 1 para. 66

[F7 187B Postponing gain or loss under section 185(2): interests in UK land U.K.

(1) This section applies if an interest in UK land is deemed to have been disposed of under section 185(2) by a company at any time.

(2) The gain or loss that, but for this subsection, would have accrued to the company at that time is not to accrue at that time.

(3) But, on a subsequent disposal by the company of the whole or part of the interest in UK land, the whole or a corresponding part of the gain or loss is treated as accruing on the subsequent disposal.

(4) This gain or loss is in addition to any gain or loss that actually accrues on the subsequent disposal.

(5) A company may elect for a disposal deemed to have been made under section 185(2) to be excluded from the operation of this section.

(6) The election must be made within 2 years after the day on which the deemed disposal occurs.

(7) In this section “interest in UK land” has the meaning given by section 1C.]

Textual Amendments

F7 S. 187B substituted (with effect in accordance with Sch. 1 paras. 120, 123 of the amending Act) by Finance Act 2019 (c. 1), Sch. 1 para. 67

188 Dual resident companies: deemed disposal of certain assets. U.K.

F8 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F8 S. 188 repealed (retrospective to 30.11.1993) by Finance Act 1994 (c. 9), s. 251(1)(a)(10), Sch. 26 Pt. 8(1)