Taxation of Chargeable Gains Act 1992

212 Annual deemed disposal of holdings of unit trusts etc. U.K.

(1) Where at the end of an accounting period the assets of an insurance company’s [F1 long-term insurance] fund include—

(a) rights under an authorised unit trust, or

(b) relevant interests in an offshore fund[F2 , or

(c) shares in a company to which Part 4 of the Finance Act 2006 applies (Real Estate Investment Trusts),]

then, subject to the following provisions of this section and to section 213, the company shall be deemed for the purposes of corporation tax on capital gains to have disposed of and immediately reacquired each of the assets concerned at its market value at that time.

F3 (2) Subsection (1) above shall not apply to assets linked solely to [F4 gross roll-up business].

F5 (2A) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F6 (3) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F6 (4) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(5) For the purposes of this section an interest is a “relevant interest in an offshore fund” if—

(a) it is a material interest in an offshore fund for the purposes of Chapter V of Part XVII of the Taxes Act, or

[F7 (b) it would be such an interest if either or both of the assumptions mentioned in subsection (6A) below were made.]

F6 (6) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

[F8 (6A) The assumptions referred to in subsection (5)(b) above are—

(a) that the companies, unit trust schemes and arrangements referred to in [F9 paragraphs (a) to (c) of subsection (1) of section 756A] of the Taxes Act are not limited to those which are also collective investment schemes;

(b) that the shares and interests excluded by subsections (6) and (8) of [F10 section 759 of that Act] are limited to shares or interests in trading companies.]

(7) In this section “trading company” means a company—

(a) whose business consists of the carrying on of insurance business, or the carrying on of any other trade which does not consist to any extent of dealing in commodities, currency, securities, debts or other assets of a financial nature, or

(b) whose business consists wholly or mainly of the holding of shares or securities of trading companies which are its 90 per cent. subsidiaries;

F11 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F12 (7A) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F13 (8) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F1 Words in s. 212(1) substituted (1.12.2001) by The Financial Services and Markets Act 2000 (Consequential Amendments) (Taxes) Order 2001 (S.I. 2001/3629), arts. 1(2)(a), 73(1)(a)

F2 S. 212(1)(c) and preceding word inserted (19.7.2006) by Finance Act 2006 (c. 25), s. 137

F3 Words in s. 212(2) inserted (6.4.2005) by The Child Trust Funds (Insurance Companies) Regulations 2004 (S.I. 2004/2680), regs. 1, 19

F4 Words in s. 212(2) substituted (with effect in accordance with s. 38(2) of the amending Act) by Finance Act 2007 (c. 11), Sch. 7 para. 63 (with Sch. 7 Pt. 2)

F5 S. 212(2A) repealed (with effect in accordance with Sch. 10 para. 17(2) of the amending Act) by Finance Act 2007 (c. 11), Sch. 10 para. 5(3)(a), Sch. 27 Pt. 2(10)

F6 S. 212(3)(4)(6) repealed (27.7.1993 with effect in relation to accounting periods beginning on or after 1.1.1993) by 1993 c. 34, ss. 91(2)(b), 213, Sch. 23 Pt. III Table(8) Note

F7 S. 212(5)(b) substituted (with effect in accordance with s. 134(10) of the amending Act) by Finance Act 1995 (c. 4), s. 134(6)

F8 S. 212(6A) inserted (with effect in accordance with s. 134(10) of the amending Act) by Finance Act 1995 (c. 4), s. 134(7)

F9 Words in s. 212(6A)(a) substituted (with effect in accordance with s. 145(2) of the amending Act) by Finance Act 2004 (c. 12), Sch. 26 para. 11(a) (with Sch. 26 para. 17)

F10 Words in s. 212(6A)(b) substituted (with effect in accordance with s. 145(2) of the amending Act) by Finance Act 2004 (c. 12), Sch. 26 para. 11(b) (with Sch. 26 para. 17)

F11 Words in s. 212(7) repealed (10.7.2003) by Finance Act 2003 (c. 14), Sch. 43 Pt. 3(12)

F12 S. 212(7A) repealed (with effect in accordance with s. 39(2) of the amending Act) by Finance Act 2007 (c. 11), Sch. 8 para. 18, Sch. 27 Pt. 2(8) (with Sch. 8 Pt. 2)

F13 S. 212(8) repealed (27.7.1993 with effect as mentioned in s. 91(1)) by 1993 c. 34, ss. 91(1), 213, Sch. 23 Pt. III Table(8) Note

Modifications etc. (not altering text)

C1 S. 212 modified (31.7.1992) by S.I. 1992/1655, arts. 1, 21

S. 212 amended (27.7.1993) by 1993 c. 34, s. 91(1)

S. 212 excluded (27.7.1993) by 1993 c. 34, s. 91(1)

C2 S. 212 modified (with effect in accordance with s. 105(1) of the amending Act) by Finance Act 1996 (c. 8), s. 105, Sch. 15 para. 15(2)

C3 S. 212 modified (with effect in accordance with reg. 1(2) of the amending S.I.) by The Friendly Societies (Modification of the Corporation Tax Acts) Regulations 2005 (S.I. 2005/2014), regs. 1(1), 37

C4 S. 212(1) excluded by 1988 c. 1, s. 440B(5) (as inserted (with effect in accordance with Sch. 8 para. 57(1) of the amending Act) by Finance Act 1995 (c. 4), Sch. 8 para. 28(1) (with Sch. 8 para. 55(2)))