Section 171A: Election to reallocate gain or loss to another member of the group

This section applies where—

In determining for the purposes of subsection (1)(c) whether subsection (1) of section 171 would have applied, it is to be assumed that subsection (1A)(b) of that section read—

In this section "the time of accrual" means the time the chargeable gain or allowable loss accrues to company A (or would so accrue but for an election under this section).

Companies A and B may make a joint election to transfer the chargeable gain or allowable loss, or such part of it as is specified in the election, from company A to company B (but see subsection (4A)).

An election may not be made under this section to transfer the whole or part of a ring fence chargeable gain from a company carrying on a ring fence trade to a company not carrying on such a trade.

In subsection (4A)—

• "ring fence chargeable gain", in relation to a company, means—

  (a)a chargeable gain accruing to the company on a material disposal within the meaning of section 197 (disposals of interests in oil fields etc: ring fence provisions), or

  (b)a chargeable gain treated as accruing to the company by virtue of section 197(4);

• "ring fence trade" has the same meaning as in Part 8 of CTA 2010 (see section 277 of that Act).

An election under this section must be made—

An election, or two or more elections made simultaneously, is or are of no effect if, taken together with each earlier election (if any) made in respect of the same gain or loss, it or they would (apart from this subsection) have effect in relation to an amount exceeding the gain or loss.

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

For the effect of an election under this section, see section 171B.