Finance Act 1985

14 (1) If, apart from this paragraph, the qualifying period appropriate to a qualifying disposal (in this paragraph referred to as “the original qualifying period”) would be less than ten years but throughout some period (in this paragraph referred to as “the earlier business periods”) which—

(a) ends not earlier than two years before the beginning of the original qualifying period, and

(b) falls, in whole or in part, within the period of ten years ending at the end of the original qualifying period,

the individual making the disposal or, as the case may be, the relevant beneficiary was concerned in the carrying on of another business (in this paragraph referred to as the “previous business”) then, for the purpose of determining the amount available for relief on the qualifying disposal, the length of the qualifying period appropriate to that disposal shall be redetermined on the assumptions and subject to the provisions set out below.

(2) For the purposes of the redetermination referred to in subparagraph (1) above, it shall be assumed that the previous business is the same business as the business at retirement and, in the first instance, any time between the end of the earlier business period and the beginning of the qualifying period shall be disregarded (so that those two periods shall be assumed to be one continuous period).

(3) The reference in sub-paragraph (1) above to a person being concerned in the carrying on of a business is a reference to his being so concerned personally or as a member of a partnership or, if the business was owned by a company, then as a full-time working director of that company or, as the case may be, of any member of the group or commercial association of which it is a member; and the reference in sub-paragraph (2) above to the business at retirement is a reference to that business which, in relation to the qualifying disposal, is referred to—

(a) in subsection (3), subsection (4) or subsection (5) of section 69 of this Act where the qualifying disposal is a material disposal of business assets;

(b) in subsection (5) of section 70 of this Act where that disposal is a trustees’ disposal; and

(c) in subsection (7) of section 70 of this Act where that disposal is an associated disposal.

(4) any extended qualifying period resulting from the operation of sub-paragraph (2) above shall not begin earlier than the beginning of the period of ten years referred to in sub-paragraph (1)(b) above.

(5) If the earlier business period ended before the beginning of the original qualifying period, any extended qualifying period which would otherwise result from the operation of the preceding provisions of this paragraph shall be reduced by deducting therefrom a period equal to that between the ending of the earlier business period and the beginning of the original qualifying period.

(6) Where there is more than one business which qualifies as the previous business and, accordingly, more than one period which qualifies as the earlier business period, this paragraph shall apply first in relation to that one of those businesses in which the individual in question was last concerned and shall then again apply (as if any extended qualifying period resulting from the first application were the original qualifying period) in relation to the next of those business and so on.