Section 860 | Adjustment income

(1)A change in the persons carrying on a trade from one period of account to the next does not prevent Chapter 17 of Part 2 (adjustment income) applying in relation to the trade so long as a person carrying on the trade immediately before the change continues to carry on the trade immediately after the change.

(1A)A change in the persons carrying on a property business from one period of account to the next does not prevent Chapter 7 of Part 3 (adjustment income) applying in relation to the property business so long as a person carrying on the property business immediately before the change continues to carry on the property business immediately after the change.

(2)A change in the persons carrying on a trade does not constitute the permanent cessation of the trade for the purposes of Chapter 17 of Part 2 so long as a person carrying on the trade immediately before the change continues to carry on the trade immediately after the change.

(3)In the case of a trade or property business carried on by a firm the amount of any adjustment under Chapter 17 of Part 2 , or Chapter 7 of Part 3, is calculated as if the firm were a UK resident individual.

(4)Each partner's share of any amount of adjustment income is determined according to the firm's profit-sharing arrangements for the 12 months ending immediately before the date on which the new basis was adopted.

(5)Any election under Chapter 17 of Part 2 , or under section 239B as applied to property businesses by section 334A, must be made jointly by all the persons who have been members of the firm in that 12 month period.

(6)For the purposes of this section—

(a)“adjustment income” and “change of basis” have the same meaning as in Chapter 17 of Part 2, or Chapter 7 of Part 3 (as the case requires)

(b)“profit-sharing arrangements” means the rights of the partners to share in the profits of the trade or property business (as the case requires), and

(c)references to the date on which a new basis was adopted are to the first day of the first period of account for which the new basis was adopted.

(7)Sections 849 to 851 do not apply so far as this section applies.