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Rollover Relief timing issue

Rollover Relief timing issue

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I have a new client company with two brothers as directors/equal shareholders and a third brother who is not a director or shareholder of the company (non are employees of the company).

Between them they own about 100 acres of farmland which has been rented to the trading company at a nominal rent for about 20 years.

The land may be sold in the near future and they want to roll the gain over into new land. 

The third brother's history would not as i see it qualify for rollover. The land sale may take some two or three years because it is linked to planning permission. Would he qualify for Rollover if the other brothers were to gift him/sell him 2.5% each of the share capital in the trading company and would the Rollover then be restricted in any way because of the short time he has held the shares?

My reading is that the 5% shareholding is at point of sale and acquisition (of new land to be used by same company) and also normally Rollover is restricted to period of use in the trade. Do the two combine to give a reduced but qualifying entitlement to Rollover or is time not factor?


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11th May 2015 17:07

Initial reaction, as I am packing up to head home ...

... is that relief will be time-restricted to the period when he holds a qualifying interest in the company. Others with more time to research/answer may have a different view.

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11th May 2015 17:23

Am I missing some interesting quirk...

... of rollover relief in relation to farmland?

I thought that the 5% point applied to holdover relief (and entrepreneurs' relief)?

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11th May 2015 18:33

Steve ...

... TCGA 1992 s157?

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12th May 2015 10:26

Thanks BKD

I have never come across that, and on a scan through the legislation didn't find it.

I thought Mr Minion had his wires crossed. Apologies for that.

I read that legislation as meaning that if the 5% is held both at sale and purchase of the new assets, the trade that the company has carrried on is treated as having been carried on by the individual for the purposes of the relief.

CG61250 doesn't really address the point.

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12th May 2015 11:47


If the land has been used by the company throughout the period of ownership then I see no restriction in relief simply because the company was not the third brother's personal company for the whole time. S157 simply requires it at the date of disposal of the old asset and the date of acquisition of the new asset.

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12th May 2015 14:37

it is indeed

s157, sorry i should have included that.


I haven't been able to find anything that imposes the time restriction that would normally apply, it just seems too simple, which usually means i have missed something!

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