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Implications for companies in a gains group

The main implications of companies being grouped for capital gains purposes are:

1. •

   transfers between group members are at no-gain / no-loss

2. •

   degrouping charges may arise where there has been a previous no-gain / no-loss transfer and the transferee company leaves the group within six years

3. •

   groups can elect for assets to be deemed to have been transferred on a no-gain / no-loss basis

4. •

   rollover relief may be applied on a group-wide basis

There are similar rules relating to intangible fixed assets.

There are also exemptions from both stamp duty and stamp duty land tax for transfers between group companies. Both of these sets of rules include provisions to claw back relief in certain circumstances. See the Stamp duty ― corporate transactions and Stamp duty land tax ― corporate transactions guidance notes.

See Simon’s Taxes D2.301 onwards for more detailed commentary.

Definition of group for capital gains purposes

Companies are in the same capital gains group when one company owns at least 75% of the ordinary shares