Section 357OL | Realisation and acquisition of fungible assets

(1)Subsection (2) applies if—

(a)a company realises a fungible asset, and

(b)apart from section 357OK(2), the asset would be treated as part of a single asset comprising both pre-commencement assets and assets that are not pre-commencement assets.

(2)The realisation is treated as diminishing the single asset of the company comprising pre-commencement assets in priority to diminishing the single asset of the company comprising assets that are not pre-commencement assets.

(3)Fungible assets acquired by a company that would not otherwise be treated as pre-commencement assets are so treated so far as they are identified, in accordance with the following rules, with pre-commencement assets realised by the company.

(4)Rule 1 is that assets acquired are identified with pre-commencement assets of the same kind realised by the company within the period beginning 30 days before and ending 30 days after the date of the acquisition.

(5)The reference in subsection (4) to assets “of the same kind” is to assets that are, or but for section 357OK(2) would be, treated as part of a single asset because of section 858 of CTA 2009.

(6)Rule 2 is that assets realised earlier are identified before assets realised later.

(7)Rule 3 is that assets acquired earlier are identified before assets acquired later.

(8)In this section—

“fungible asset” means an intangible fixed asset to which section 858 of CTA 2009 applies;

“realisation”, in relation to a fungible asset, has the same meaning as in Part 8 of CTA 2009 (see sections 734 and 856 of that Act).