Contents

►This section describes the rules concerning the transfer of activities to newly established subsidiaries.◄

 

►The section covers◄

    ►
  • Section 4(5) of SEL (Section 19(1) of PAL)
  • Section 8 A of SEL (Section 19(2) of PAL)
    •   Section 4(5) of SEL (Section 19(1) of PAL) ◄

►Section 4(5) of SEL applies if a provider liable to PAL taxation transfers an activity to a newly established subsidiary in which the provider becomes the owner of all the shares. If the provider is liable to taxation under both PAL and SEL, the transfer must be given tax effect from the same date.◄

 

►This means that the transfer in this situation, in relation to PAL, can be given retroactive effect to the closing date for the opening balance sheet of the subsidiary.◄

 

►If a company is transferred to a newly established fully-owned subsidiary, the provider can choose whether the transfer should be given tax effect from◄

    ►
  • the date of the transfer or
  • the closing date for the opening balance sheet of the subsidiary.
    • ◄

 

►The transfer must, however, be given tax effect from the same date in relation to PAL and SEL.◄

 

See also

►See Assessment Guide 2008, Companies and shareholders, section S.B.1.4.2.1 Establishment with retroactive effect.◄

 

Section 8 A of SEL (Section 19(2) of PAL)

►Section 8 A of SEL applies in connection with a taxable merger of providers which are liable to taxation under PAL. If the providers are liable to taxation under both PAL and SEL, the transfer must be given tax effect from the same date. ◄

 

►This means that the participating providers can decide that the merger, in relation to PAL, should be given tax effect from the closing date for the opening balance sheet of the continuing provider.◄

 

►In connection with a taxable merger, the participating companies can choose whether the merger should take effect from◄

    ►
    • the time when the merger is finally approved by the participating companies or
    • the closing date for the opening balance sheet of the continuing company.
    ◄

 

►The choice must, however, be the same in relation to PAL and SEL.◄

 

See also

►See Assessment Guide 2008, Companies and shareholders, section S.D.1 Merger.◄