Finance Act 1994

Chargeable gains: roll-over relief U.K.

6 (1) Subject to the following provisions of this paragraph, where any asset, or any interest in an asset, is the subject of a relevant transfer, sections 152 to 160 of the Gains Act (roll-over relief on replacement of business assets) shall have effect as if— U.K.

(a) the asset or interest had been acquired by the transferee—

(i) at the time at which, and for the consideration for which, the predecessor acquired it; and

(ii) for the purpose of the asset’s use in a trade carried on by the transferee (and not wholly or partly for the purpose of realising a gain from the disposal of the asset or interest), but only to the extent that the predecessor’s acquisition was for the purpose of the asset’s use in a trade carried on by him (and not wholly or partly for the purpose of realising a gain from the disposal of the asset or interest);

(b) throughout the period during which the asset or interest was owned by the predecessor, it had been owned by the transferee; and

(c) to the extent that the predecessor—

(i) used the asset, or

(ii) in the case of an asset falling within head A of Class 1 in section 155 of that Act, used and occupied the asset,

during that period for the purposes of a trade carried on by him, the transferee had used or, as the case may be, used and occupied the asset for the purposes of a trade carried on by him.

(2) In any case where—

(a) a held-over gain would, but for the provisions of section 154 of the Gains Act (depreciating assets), have been carried forward to a depreciating asset, and

(b) that asset is the subject of a relevant transfer,

that section shall have effect as if the gain had accrued to, and the claim for it to be held over had been made by, the transferee and as if the predecessor’s acquisition of the depreciating asset had been the transferee’s acquisition of that asset.

(3) Where an asset, or an interest in an asset, is the subject of a relevant transfer, the predecessor shall not be entitled at any time after the coming into force of the relevant transfer to make any claim under section 152 or 153 of the Gains Act in respect of his acquisition of the asset or interest.

(4) Where an asset, or an interest in an asset, is the subject of a relevant transfer, the transferee shall not, by virtue of any provision of this Schedule, be treated for the purposes of sections 152 to 154 of the Gains Act as having applied the whole or any part of the consideration for any disposal—

(a) in acquiring the asset or interest by virtue of the relevant transfer; or

(b) in acquiring the asset or interest as postulated in sub-paragraph (1)(a) above, if the predecessor has made a claim under section 152 or 153 of that Act in respect of his acquisition of the asset or interest.

(5) Without prejudice to paragraph 1(4)(b) above, expressions used in sub-paragraph (2) above and in section 154 of the Gains Act have the same meaning in that sub-paragraph as they have in that section.