CTM17270 - Distributions: demergers: action required in offices
You should follow the procedures set out below if you receive:
- a clearance application in connection with a demerger, under ICTA88/S215 (1), or
- a clearance application in respect of a potential chargeable payment following a demerger, under ICTA88/S215 (2), or
- a return under ICTA88/S216, and you have not yet received instructions from the Clearance and Counteraction Team, Anti-Avoidance Group.
Clearance application for proposed demerger - ICTA88/S215 (1)
You should forward a clearance application under ICTA88/S215 (1) on the day you receive it to:
The Clearance and Counteraction Team, Anti-Avoidance Group
Telephone 020 7438 7474
Fax 020 7438 4409
You should send the applicant a letter explaining the action you have taken in the following terms:
‘I refer to the application for clearance you sent me. Please note that all such applications must be made to the Board and not to the local Area Office. I have sent the application to the Clearance and Counteraction Team, Anti-Avoidance Group based in 22 Kingsway London WC2B 6NR. I am advised that the 30 day time limit within which the Board is expected to reply will begin when the application is received by them.’
If appropriate refer the applicant to the Annex to SP13/80.
It is not possible to make retrospectively a demerger clearance application under ICTA88/S215 (1).
- If a company carries out a demerger without obtaining advance clearance, the tax implications of the transactions are dealt with on normal lines. Relief under ICTA88/S213 may or may not be due, depending on the circumstances.
- You should refer such cases to the Clearance and Counteraction Team, Anti-Avoidance Group for advice concerning the possible application of ICTA88/S213. You should send the file along with a brief summary of the transactions that have taken place.
You might receive joint or similar applications for clearance under this or other provisions. Other provisions include:
- TCGA92/S138 (see CG52631), TCGA92/S139 (5) (see CG52752), ICTA88/S707 (see CTM36880), and ICTA88/S225 (see CTM17570).
- If there is more than one application you should forward them all to the Clearance and Counteraction Team, Anti-Avoidance Group.
Clearance application in respect of a potential chargeable payment following a demerger ICTA88/S215 (2)
You should deal with a clearance application regarding a payment within five years of an exempt distribution in the same way as shown above for a clearance application regarding a proposed demerger. However, you should not enclose a copy of SP13/80. You should forward the application to The Clearance and Counteraction Team, Anti-Avoidance Group on the day you receive it.
Normally the Clearance and Counteraction Team, Anti-Avoidance Group will give you instructions before you receive a return under ICTA88/S216 regarding an exempt distribution or a chargeable payment. Only exceptionally should you receive such a return before this. If you do, you should send it immediately to the Clearance and Counteraction Team, Anti-Avoidance Group together with the relevant files.