CG52800 - Company reconstructions: company: general

TCGA92/S139 applies to the disposal of chargeable assets by a company if a scheme of reconstruction includes the transfer of a company's business. The section is very similar in operation to TCGA92/S171, which applies to the transfer of assets between members of the same group of companies. In both cases the transfer is treated as a no gain/no loss disposal. Where the shares and debentures were issued under the scheme before 17 April 2002 it was possible to transfer a business using the provisions of Section 139 only. This is no longer possible following the introduction of Schedule 5AA. Now, for any transfer of a business to fall within Section 139, there must be a scheme of reconstruction that meets the conditions of Sch 5AA and includes an issue of shares under Section 136.