A Taxable Person may choose not to account for gains or losses on transfers within a Qualifying Group. This election to be made while filing the Tax Return for the period in which the transfer occurs and is irrevocable. Once made, the election applies to all Tax Group members and remains in effect even if members leave the group or the group ceases to exist.
If a Taxable Person has not elected for Qualifying Group Relief but forms or joins a Tax Group that includes members who have made such an election, it is treated as having made the election. Similarly, a Tax Group that has not made the election is deemed to have done so if a new Subsidiary with the election joins the group.
For transfers between members of a Qualifying Group (outside of a Tax Group), no gain or loss needs to be recognized. However, gains or losses may need to be recognized if, within two years, the transferor and transferee cease to be in the same Qualifying Group or if the asset or liability is subsequently transferred outside the Qualifying Group.