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MARTIN VERRALL and RACHEL PARKER explain how the substantial shareholding exemption works in practice
KEY POINTS
- Degrouping charges.
- Transferring trade and assets into a new company.
- Dealing with goodwill.
- Group transaction.
- Applying for a non-statutory business clearance.
Finance Act 2011 introduced changes to both the degrouping charge and substantial shareholding exemption (SSE) that together mean it is now easier for UK companies to divest from non-core business activities without incurring a tax charge or costly pre-transaction restructuring.
Degrouping charges
The degrouping charge has been with us for quite some time and in the past often proved problematic for UK companies selling off parts of their group.
Although it was possible to take advantage of the UK’s attractive “transactions within a group” regime (TCGA 1992 s 170 to s 175) whereby assets can be moved around a group if...
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