This guidance note explains the general rules and provides an overview of the corporation tax implications of the disposal of company assets.

Scope of charge

When a company disposes of an asset by way of sale, gift or in any other manner, a chargeable gain or allowable loss may arise. The receipt of a capital sum in respect of compensation for the damage or destruction of a company asset may also give rise to a chargeable gain.

For tax purposes, a company is liable to corporation tax in respect of its chargeable gains. The total chargeable gains arising in an accounting period are included as part of the company's taxable total profits and taxed at the rate of corporation tax in force for the relevant financial year. See the Computation of corporation tax guidance note for details of the latest rates. CTA 2009, s 2

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