Corporation Tax Act 2009 section 794

Application of roll-over relief in relation to reallocated charge

Section 794 explains how roll-over relief on reinvestment works when a degrouping charge has been reallocated from one group company to another.

• When a degrouping charge is reallocated to company B under the group reallocation rules, company B can claim roll-over relief as if it had been the company that realised the intangible asset
• The conditions for the old asset qualifying for roll-over relief are assessed as if no reallocation election had been made and the original company (company A) had made the claim
• The proceeds of realisation and the original cost of the asset used in the roll-over relief calculation remain the same as they would have been without the reallocation election
• Where the reallocation election covers only part of the gain on the deemed realisation, the roll-over relief rules apply as though the part covered by the election relates to a separate asset, with appropriate apportionments