7(1)This paragraph applies where—U.K.
(a)a company (“the transferor company”) which is not a subsidiary of the NDA is carrying on a trade; and
(b)in consequence of a section 39 scheme, the transferor company ceases to carry on that trade and the NDA or a subsidiary of the NDA begins to carry it on.
(2)For the purposes of the allowances and charges provided for by the 2001 Act, the trade is not to be treated as permanently discontinued, nor a new trade as set up; but sub-paragraphs (3) and (4) of this paragraph are to apply.
(3)There are to be made to or on the NDA or (as the case may be) its subsidiary, in accordance with the 2001 Act, all such allowances and charges as would, if the transferor company had continued to carry on the trade, have fallen to be made to or on that company.
(4)The amounts of those allowances and charges are to be computed as if—
(a)the NDA or its subsidiary had been carrying on the trade since the transferor company began to do so; and
(b)everything done to or by the transferor company had been done to or by the NDA or that subsidiary;
but so that transfers in accordance with the section 39 scheme, so far as they relate to assets in use for the purposes of the trade, shall not be treated as giving rise to an allowance or charge.
Commencement Information
I1Sch. 9 para. 7 in force at 5.10.2004 by S.I. 2004/2575, art. 2(1), Sch. 1