The provision sets out attribution rules for trades: trades carried on by multiple persons are treated in their profit shares; trades held by trustees (other than for charitable or public purposes) are attributed to beneficiaries; and trades of companies may be treated as belonging to ordinary shareholders in proportion to holdings or to a parent company or its shareholders. ‘‘Ownership’’ is beneficial ownership, a subsidiary is one with not less than 75% of ordinary share capital owned by another company, and relatives and beneficiaries under trusts are treated as a single person for continuity purposes.

Where a predecessor company ceases and a successor begins the same trade within two years and 75% continuity of interest exists, the Corporation Tax Acts apply with continuity of allowances and charges, and specified reliefs and losses transfer to the successor (with particular references to sections 396, 397, 835AAD/AAE and 291A). Securities in trading stock are treated as sold and repurchased on transfer. Successor cessation within defined periods can give relief to the predecessor; parts of trades may be treated separately with necessary apportionments; unresolved apportionments are determined by an inspector with an appeal to the Appeal Commissioners; tax discharge or repayment relief requires a claim.