Taxes Consolidation Act 1997 section 617

Transfers of assets, other than trading stock, within group

Section 617 provides that the disposal of a chargeable asset (other than trading stock) within a group of companies is treated as giving rise to neither a gain nor a loss, subject to certain conditions and exceptions.

• Where a member of a group of companies disposes of a chargeable asset to another group member, the disposal is treated as if the consideration were such that neither a gain nor a loss accrues to the disposing company, provided both companies meet the residency or chargeable asset conditions and the acquiring company is not an investment undertaking, REIT or ICAV.
• Certain financial transactions are excluded from the relief: a disposal consisting of the satisfaction of a debt, a disposal on the redemption of shares, and a disposal in consideration for a capital distribution within the meaning of section 583.
• Where the consideration for an intra-group disposal consists of compensation for damage, injury, destruction or depreciation of an asset, the disposal is treated as being made to the person (such as an insurer) who ultimately bears the burden of providing that consideration.
• Where a specified intangible asset within the meaning of section 291A is transferred within a group, the transferor and transferee may jointly elect to disapply the no gain/no loss treatment, enabling the acquiring company to claim capital allowances under section 291A; the election must be notified to the Collector-General within 12 months of the end of the accounting period in which the transferee acquired the asset.