Demerger clearances

Produced by Tolley
Demerger clearances

The following Corporation Tax guidance note Produced by Tolley provides comprehensive and up to date tax information covering:

  • Demerger clearances
  • Non-statutory demergers
  • Statutory demergers
  • Additional reporting obligations
  • Refusal of demerger clearances

This guidance note contains specific comments on clearance applications as they refer to non-statutory and statutory demergers, and should be read in conjunction with the general guidance on drafting clearance applications in the Drafting clearance applications guidance note.

For overall guidance on demergers, including choice of the most appropriate route and planning the demerger project, see the Demergers ― overview guidance note.

Non-statutory demergers

A non-statutory demerger may involve several steps in order to achieve the desired result. These will differ depending on the circumstances but typically will require clearance under the following provisions:

  1. TCGA 1992, s 139 (reconstruction relief for corporate capital gains)

  2. TCGA 1992, s 138 (reconstruction relief from capital gains tax for shareholders

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