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A degrouping event occurs when¹:

1. Ìý

   •ÌýÌýÌýÌý a chargeable intangible asset (see D1.635), referred to as the 'relevant asset', is transferred intra-group, and

2. Ìý

   •ÌýÌýÌýÌý the transferee was a member of the transferor's group at the time of the transfer or subsequently became such a member, and

3. Ìý

   •ÌýÌýÌýÌý the transferee leaves the group within six years of the transfer

When the transferee company leaves the transferor's group holding a relevant asset, it is deemed to realise and reacquire the asset immediately after the transfer, for its market value at that time². This treatment also applies if at the time the transferee leaves the group, the asset is held by an associated company of the transferee company rather than the transferee company itself³. Two companies are associated with each other if one is a 75% subsidiary of the other or both are 75% subsidiaries of another company⁴.

See also D2.330–D2.334, as regards equivalent capital gains provisions in TCGA 1992, s 179.

There are exemptions from the degrouping