Finance Act 2000

7 (1) In Schedule 7A to the Taxation of Chargeable Gains Act 1992 (restriction on set-off of pre-entry losses), paragraph 1 (application and construction of Schedule) is amended as follows.

(2) In sub-paragraph (3)—

(a) for “it became a member of the relevant group” substitute “the relevant event occurred in relation to it”, and

(b) for “that group” substitute “the relevant group”.

(3) After sub-paragraph (3) insert—

“(3A) In this paragraph references to the relevant event occurring in relation to a company—

(a) in a case in which—

(i) the company was resident in the United Kingdom at the time when it became a member of the relevant group, or

(ii) the asset was a chargeable asset in relation to the company at that time,

are references to the company becoming a member of that group;

(b) in any other case, are references to whichever is the first of—

(i) the company becoming resident in the United Kingdom, or

(ii) the asset becoming a chargeable asset in relation to the company.

For this purpose an asset is a “chargeable asset” in relation to a company at any time if, were the asset to be disposed of by the company at that time, any gain accruing to the company would be a chargeable gain and would by virtue of section 10(3) form part of its chargeable profits for corporation tax purposes.”

(4) In sub-paragraph (4)(a) for “it became a member of the relevant group” substitute “the relevant event occurred in relation to it”.

(5) In sub-paragraph (5)—

(a) in the opening words, for the words from “the company” to “the relevant group” substitute “the relevant event occurred in relation to the company by reference to which that asset is a pre-entry asset”,

(b) in paragraph (a), for “a company has become a member of the relevant group” substitute “a relevant event has occurred in relation to a company”, and

(c) in paragraph (b), for “a company became a member of the relevant group” substitute “a relevant event occurred in relation to a company”.

(6) The above amendments, and the main amendments so far as they apply for the purposes of Schedule 7A, have effect in relation to the amount to be included in respect of chargeable gains in a company’s total profits for any accounting period ending on or after 21st March 2000.

(7) Any question whether a company was, in relation to times before 21st March 2000, a member of a group shall be determined by reference to the position under the [1992 c. 12.] Taxation of Chargeable Gains Act 1992 as it stood before the main amendments.

(8) Any question whether a company was, in relation to times before 6th April 1992, a member of a group shall be determined by reference to the position under the [1979 c. 14.] Capital Gains Tax Act 1979.

(9) Where—

(a) immediately before the time when the main amendments have effect in relation to a company in accordance with sub-paragraph (6), the company was not a member of a group of companies for the purposes of section 170 of the Taxation of Chargeable Gains Act 1992 (as it stood before the main amendments), and

(b) immediately after that time, the company is a member of a group of companies for the purposes of that section (as amended by the main amendments),

Schedule 7A to that Act shall not have effect in relation to any losses accruing to the company before that time or any chargeable assets (within the meaning of paragraph 1(3A) of that Schedule) held by it immediately before that time.