Part 14

Change in company ownership
Chapter 2

Disallowance of trading losses

Introduction to Chapter
673
1
This Chapter applies if—
a
there is a change in the ownership of a company (“the company”), and
b
condition A or B is met.
2
Condition A is that within any period of 3 years in which the change in ownership occurs there is a major change in the nature or conduct of a trade carried on by the company.
3
Condition B is that the change in ownership occurs at any time after the scale of the activities in a trade carried on by the company has become small or negligible and before any significant revival of the trade.
4
In this section “major change in the nature or conduct of a trade” includes—
a
a major change in the type of property dealt in, or services or facilities provided in, the trade, or
b
a major change in customers, outlets or markets of the trade.
This Chapter applies even if the change is the result of a gradual process which began before the period of 3 years mentioned in subsection (2).
5
In this Chapter—
- “the change in ownership” means the change in ownership mentioned in subsection (1),
- “the company” has the same meaning as in this section, and
- “trade” includes an office.