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5.5.1. Capital Gains

Where a company carries on a trade in the UK through a permanent establishment and is liable to corporation tax on its chargeable profits, these chargeable profits include chargeable gains.  Therefore, the disposal of an asset will give rise to an occasion of charge and the non-resident will be chargeable to Capital Gains Tax or Corporation Tax as appropriate in respect of the gains, if the following conditions are met:

  • at the time of the disposal, the trade, profession or vocation continues to be carried on through the UK PE;
  • the asset is situated in the UK; or
  • at or before the time of the disposal the asset has been used in or for the purposes of the trade, profession or vocation or used held or acquired for the purposes of the PE.