Section 130 is the main relieving section of this part. It provides that the disposal of a chargeable asset by one member of a group of companies to another member of the group will be deemed to be for consideration of such amount that neither a gain nor a loss accrues to the company making the disposal. Certain financial transactions are excluded, namely, a disposal which consists of paying off a debt or of redeeming shares or which takes the form of the disposal of an interest in shares on the occasion of a capital distribution. Where the consideration for a disposal consists of compensation for damage to an asset, the disposor will be treated as being to the person who ultimately bears the burden.
The examples circulated are the best way of understanding the application of the section.