Schedule 29 - Gains and losses of a company from intangible fixed assets

Part of Finance Bill – in a Public Bill Committee at 9:45 am on 13th June 2002.

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Photo of Joe Benton Joe Benton Labour, Bootle 9:45 am, 13th June 2002

With this it will be convenient to take amendment No. 183, in page 383, line 11, at end insert—

'Realisation of a pre-commencement asset

26.—(1)This paragraph applies where there is a realisation of a ''pre-commencement asset'' that is an intangible fixed asset—

(a) that was held by the company, or in the same worldwide group, before commencement, as defined by Part 14 of this Schedule, and

(b) on which no deduction has been claimed under Part 2 of this Schedule.

(2) The company can elect to tax the realisation of the pre-commencement asset under the ''existing law'', as defined by Part 14 of this Schedule.

(3) The election must be made in writing to the Board of the Inland Revenue within two years of the end of the accounting period during which the realisation takes place.

(4) In particular, the making of the election will allow the company to roll over the proceeds on realisation of the pre-commencement asset under the replacement of business assets rules in section 152 of the Taxation of Chargeable Gains Act 1992.

(5) Where the creation of an intangible fixed asset straddles the commencement date the election may be made only in respect of the pre-commencement portion. The proceeds on realisation should be apportioned between pre and post commencement on a just and reasonable basis.'.