676Company reconstructions

1

Subsection (2) applies if, before the change in ownership—

a

a trade carried on by another company (“the predecessor company”) is transferred to the company, and

b

the transfer is a transfer to which Chapter 1 of Part 22 applies (transfers of trade without a change of ownership).

2

In determining any relief available to the company by virtue of section 944(3) (carry forward of trading losses in successor company), this Chapter applies as if—

a

references to a trade carried on by the company included the trade as carried on by the predecessor company or by any predecessor of that company, and

b

any loss sustained by the predecessor company or any predecessor of that company had been sustained by the company.

3

Subsection (4) applies if, after the change in ownership—

a

a trade carried on by the company is transferred to another company (“the successor company”), and

b

the transfer is a transfer to which Chapter 1 of Part 22 applies.

4

In determining—

a

any relief available to the company under section 45 (carry forward of trading losses), or

b

any relief available to the successor company or any successor of that company by virtue of section 944(3),

this Chapter applies as if references to a trade carried on by the company included the trade as carried on by the successor company or by any successor of that company.

5

For the purposes of this section a company (“company A”) is a predecessor of another company (“company B”), and company B is a successor of company A, if the first or second condition is met.

6

The first condition is that Chapter 1 of Part 22 applies in relation to company A and company B as respectively the predecessor and the successor within the meaning of that Chapter.

7

The second condition is that—

a

Chapter 1 of Part 22 applies in relation to company A and a third company (“company C”) as respectively the predecessor and the successor within the meaning of that Chapter, and

b

company C is (whether by virtue of the first condition or this condition) a predecessor of company B.