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Tax written down value

 I have a company controlled by Mr A & Mrs A equally. This company has ceased trading and sold it's fixed assets to a Newco owned 100% by Mr A's daughter. The Newco is carrying on the same trade previously undertaken. As I understand it the fixed assets can be transferred at twdv under CAA2001 s266 as Mr A and his daughter are connected by virtue of  CAA2001 s575. Please can anybody confirm this is correct.

Many thanks


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if the same person has control of both, or a person has control of one and persons connected with him, or he and persons connected with him, have control of the other


So - Mr and Mrs control company A


While daugter of A controls the other.


Looks like it!

Thanks (1)
13th Aug 2012 16:14

Part 22, CTA 2010: Transfer of trade ....

Transfer of trade without a change of ownership?

For the purposes of Part 22, CTA2010 "relatives" are treated as being a single person {Sections 941(7) & (8)}

If the daughter's company is carrying on the same trade as the parents' company then there will not have been a change of ownership for the purposes of the these provisions.

The transfer of the assets does not give rise to a balancing event. The original company will be entitiled to WDAs/AIA as normal for its final accounting period. The new company will inherit the tax WDV of the plant & machinery.{Section 948}.

The daughter's company will also have to take into account the costs incurred by the original company when it comes to determining the disposal value of any of the plant; it cannot restrict the disposal proceeds to its own acquisition cost.

Does the parents' company have any allowable trading losses? If so, the rules in Part 22 will catch these also. The old company will not be able to claim terminal loss relief; but it is possible that the losses can be transferred to the new company if it has taken on liabilities along with the assets.


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