These rules apply for corporation tax purposes, for the section 104 rules in relation to capital gains tax see C2.716.
Disposals of shares or securities are matched for the calculation of chargeable gains against acquisitions of shares or securities according to the rules set out in C2.707. Where the acquisition is within the same day or 10-day rule the actual cost of the matched acquisition is included in the computation of the gain or loss. Where the disposal is matched with the section 104 holding the rules set out below apply. If the disposal is matched with a 1982 holding the rules in C2.718 apply.
As regards company reconstructions and reorganisations, see Division D6.1.
Creation of a section 104 holding
Shares of the same class, acquired by the same person in the same capacity are included in a section 104 holding1. In order to calculate the acquisition cost and indexation allowance for each section 104 holding a cumulative record has to be maintained showing the number of units and acquisition
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