Finance Act 1982

83 Relief on compulsory purchase

After section 111 of the [1979 c. 14.] Capital Gains Tax Act 1979 there shall be inserted the following sections—

“111A Rollover relief on compulsory acquisition.

(1) This section applies where—

(a) on or after 6th April 1982 land (in this section referred to as " the old land ") is disposed of by any person (in this section referred to as " the landowner ") to an authority exercising or having compulsory powers; and

(b) the landowner did not take any steps, by advertising or otherwise, to dispose of the old land or to make his willingness to dispose of it known to the authority or others ; and

(c) the consideration for the disposal is applied by the landowner in acquiring other land (in this section referred to as " the new land ") not being land excluded from this paragraph by section 11 IB below.

(2) Subject to section 11 IB below, in a case where the whole of the consideration for the disposal was applied as mentioned in subsection (1)(c) above, the landowner, on making a claim as respects the consideration so applied, shall be treated for the purposes of this Act—

(a) as if the consideration for the disposal of the old land were (if otherwise of a greater amount or value) of such amount as would secure that on the disposal neither a gain nor a loss accrues to him ; and

(b) as if the amount or value of the consideration for the acquisition of the new land were reduced by the excess of the amount or value of the actual consideration for the disposal of the old land over the amount of the consideration which he is treated as receiving under paragraph (a) above.

(3) If part only of the consideration for the disposal of the old land was applied as mentioned in subsection (1)(c) above, then, subject to section 11 IB below, if the part of the consideration which was not so applied (in this subsection referred to as " the unexpended consideration ") is less than the amount of the gain (whether all chargeable gain or not) accruing on the disposal of the old land, the landowner, on making a claim as respects the consideration which was so applied, shall be treated for the purposes of this Act—

(a) as if the amount of the gain so accruing were reduced to the amount of the unexpended consideration (and, if not all chargeable gain, with a proportionate reduction in the amount of the chargeable gain); and

(b) as if the amount or value of the consideration for the acquisition of the new land were reduced by the amount by which the gain is reduced (or, as the case may be, the amount by which the chargeable gain is proportionately reduced) under paragraph (a) above.

(4) Nothing in subsection (2) or subsection (3) above affects the treatment for the purposes of this Act of the authority by whom the old land was acquired or of the other party to the transaction involving the acquisition of the new land.

(5) For the purposes of this section—

(a) subsection (2) of section 115 below shall apply in relation to subsection (2) (a) and subsection (2) (b) above as it applies in relation to subsection (1)(a) and subsection (1)(b) of that section ; and

(b) subsection (3) of that section shall apply as if any reference to the new assets were a reference to the new land, any reference to the old assets were a reference to the old land and any reference to that section were a reference to this.

(6) Where this section applies, any such amount as is referred to in subsection (2) of section 110 above shall be treated as forming part of the consideration for the disposal of the old land and. accordingly, so much of that subsection as provides for a deemed disposal of other land shall not apply.

(7) The provisions of this Act fixing the amount of the consideration deemed to be given for the acquisition or disposal of assets shall be applied before this section is applied.

(8) In this section—

• " land " includes any interest in or right over land; and

• " authority exercising or having compulsory powers " shall be construed in accordance with section 108(5) above.

111B Provisions supplementary to section 111A.

(1) Land is excluded from paragraph (c) of subsection (1) of section 111A above if—

(a) it is a dwelling-house or part of a dwelling house (or an interest in or right over a dwelling-house), and

(b) by virtue of, or of any claim under, any provision of sections 101 to 105 above (private residences) the whole or any part of a gain accruing on a disposal of it by the landowner at a material time would not be a chargeable gain;

and for the purposes of this subsection " a material time " means any time during the period of six years beginning on the date of the acquisition referred to in the said paragraph (c).

(2) If, at any time during the period of six years referred to in subsection (1) above, land which at the beginning of that period was not excluded from section 111A(1)(c) above by virtue of that subsection becomes so excluded, the amount of any chargeable gain accruing on the disposal of the old land shall be redetermined without regard to any relief previously given under section 111A above by reference to the amount or value of the consideration for the acquisition of that land; and all such adjustments of capital gains tax, whether by way of assessment or otherwise, may be made at any time, notwithstanding anything in section 34 of the [1970 c. 9.] Taxes Management Act 1970 (time limit for assessments).

(3) Where the new land is a depreciating asset, within the meaning of section 117 below, that section has effect as if—

(a) any reference in subsection (1) or subsection (3) to section 115 or section 116 were a reference to subsection (2) or subsection (3) respectively of section 111A above ; and

(b) paragraph (b) of subsection (2) were omitted ; and

(c) the reference in subsection (4) to section 115(3) were a reference to that provision as applied by section 111A(5) above.

(4) No claim may be made under section 108 above in relation to a transfer which constitutes a disposal in respect of which a claim is made under section 111A above.

(5) Expressions used in this section have the same meaning as in section 111 A above.”