Taxation of Chargeable Gains Act 1992

[F1 21 (1) This paragraph applies if— U.K.

(a) an election under paragraph 12 that has been made in respect of a qualifying fund or qualifying company has effect at any time,

(b) a participant in the relevant fund is entitled to receive an amount at that time (“the relevant time”) which represents, in substance, value derived (directly or indirectly) from a direct disposal of UK land or from the UK land component of an indirect disposal of UK land, F2 ...

(c) the amount is regarded as being of a revenue nature and does not fall to be taken into account for the purposes of income tax or corporation tax on income F3 ...[F4 , and

(d) some or all of the value which is represented by the amount does not fall to be taken into account for the purposes of income tax or corporation tax on income.]

(2) In the case of an election made in respect of a qualifying fund, the participant in the relevant fund is deemed for the purposes of this Act—

(a) to have sold its units in the relevant fund immediately before the relevant time at their market value immediately before that time [F5 (as adjusted, if applicable, in accordance with sub-paragraph (3A))], and

(b) to have reacquired those units immediately after the relevant time at their market value immediately after that time.

(3) In the case of an election made in respect of a qualifying company, the participant in the relevant fund is deemed for the purposes of this Act—

(a) to have sold its rights and interests in [F6 the relevant entity] immediately before the relevant time at their market value immediately before that time [F7 (as adjusted, if applicable, in accordance with sub-paragraph (3A))], and

(b) to have reacquired those rights and interests immediately after the relevant time at their market value immediately after that time.

[F8 (3A) If some of the value (“the taxed value”) which is represented by the amount falls to be taken into account for the purposes of income tax or corporation tax on income, the market value mentioned in sub-paragraph (2)(a) or (3)(a) is to be reduced by so much of that market value as, on a just and reasonable basis, can be attributable to the taxed value.]

(4) In this paragraph “the UK land component” of an indirect disposal of UK land means the interests in UK land taken into account in determining whether the disposal is an indirect disposal of UK land.

[F9 (5) In this paragraph “the relevant entity” means—

(a) in a case where the relevant fund is constituted by a CoACS (within the meaning of paragraph 12), the CoACs, and

(b) in any other case, the qualifying company.]]

Textual Amendments

F1 Sch. 5AAA inserted (with effect in accordance with Sch. 1 paras. 120, 123 of the amending Act) by Finance Act 2019 (c. 1), Sch. 1 para. 21

F2 Word in Sch. 5AAA para. 21(1) omitted (24.3.2021) by virtue of The UK Property Rich Collective Investment Vehicles (Amendment of the Taxation of Chargeable Gains Act 1992) Regulations 2021 (S.I. 2021/213), regs. 1(1)(2), 8(2)(a)

F3 Words in Sch. 5AAA para. 21(1) omitted (24.3.2021) by virtue of The UK Property Rich Collective Investment Vehicles (Amendment of the Taxation of Chargeable Gains Act 1992) Regulations 2021 (S.I. 2021/213), regs. 1(1)(2), 8(2)(b)

F4 Sch. 5AAA para. 21(1)(d) and word inserted (24.3.2021) by The UK Property Rich Collective Investment Vehicles (Amendment of the Taxation of Chargeable Gains Act 1992) Regulations 2021 (S.I. 2021/213), regs. 1(1)(2), 8(2)(c)

F5 Words in Sch. 5AAA para. 21(2)(a) inserted (24.3.2021) by The UK Property Rich Collective Investment Vehicles (Amendment of the Taxation of Chargeable Gains Act 1992) Regulations 2021 (S.I. 2021/213), regs. 1(1)(2), 8(3)

F6 Words in Sch. 5AAA para. 21(3)(a) substituted (with effect in accordance with reg. 1(2) of the amending S.I.) by The UK Property Rich Collective Investment Vehicles (Amendment of the Taxation of Chargeable Gains Act 1992) Regulations 2020 (S.I. 2020/315), regs. 1(1), 11(b)

F7 Words in Sch. 5AAA para. 21(3)(a) inserted (24.3.2021) by The UK Property Rich Collective Investment Vehicles (Amendment of the Taxation of Chargeable Gains Act 1992) Regulations 2021 (S.I. 2021/213), regs. 1(1)(2), 8(3)

F8 Sch. 5AAA para. 21(3A) inserted (24.3.2021) by The UK Property Rich Collective Investment Vehicles (Amendment of the Taxation of Chargeable Gains Act 1992) Regulations 2021 (S.I. 2021/213), regs. 1(1)(2), 8(4)

F9 Sch. 5AAA para. 21(5) inserted (with effect in accordance with reg. 1(2) of the amending S.I.) by The UK Property Rich Collective Investment Vehicles (Amendment of the Taxation of Chargeable Gains Act 1992) Regulations 2020 (S.I. 2020/315), regs. 1(1), 11(c)