Section 173 — Taxation of Chargeable Gains Act 1992: Transfers within a group: trading stock.

Transfers within a group: trading stock. 173 1 Where—

a a company (“company A”) acquires an asset as trading stock of a trade to which this section applies, b the acquisition is from a company (“company B”) that at the time of the acquisition is a member of the same group of companies, and c the asset did not form part of the trading stock of any such trade carried on by company B, company A is treated for the purposes of section 161 as having acquired the asset otherwise than as trading stock and immediately appropriated it for the purposes of the trade as trading stock.

2 Where—

a a company (“company C”) disposes of an asset forming part of the trading stock of a trade to which this section applies carried on by that company, b the disposal is to another company (“company D”) that at the time of the disposal is a member of the same group of companies, and c the asset is acquired by company D otherwise than as trading stock of any such trade carried on by it, company C is treated for the purposes of section 161 as having appropriated the asset immediately before the disposal for some purpose other than the purpose of use as trading stock.

3 The trades to which this section applies are—

a any trade carried on by a company resident in the United Kingdom, and b any trade carried on in the United Kingdom through a permanent establishment by a company not so resident.