Corporation tax – Groups and chargeable gains for ATX-UK – part 4: self-test.

Test your understanding

(1). In which of the following situations would the SSE be available in respect of the disposal in the year ended 31 March 2023?

BK Ltd sold 4% of the ordinary share capital of TW Ltd on 1 June 2022. It had owned 18% of TW Ltd for many years. TW Ltd is a trading company.
B  DN Ltd purchased 8% of the ordinary share capital of GX Ltd on 1 January 2021. It sold all of the shares on 15 August 2022. GX Ltd is a trading company.
C  PK Ltd purchased 22% of LV Ltd on 1 July 2019. It sold 16% of the company on 1 March 2022 and then sold all of the remaining shares on 30 September 2022. LV Ltd is a trading company.

(2). State whether the following statements are true or false.

A  The SSE will relieve a degrouping charge arising on the sale of a company.
B  Where shares are sold at a loss, the SSE may prevent a capital loss arising.

Answers