Taxation of Chargeable Gains Act 1992 (c. 12)

Part II U.K. General Provisions relating to computation of gains and acquisitions and disposals of assets

Chapter III U.K. Computation of gains: General provisions

[F1 Cash basis accounting U.K.

Textual Amendments

F1 Ss. 47A, 47B and cross-heading inserted (with effect in accordance with Sch. 4 paras. 56, 57 of the amending Act) by Finance Act 2013 (c. 29), Sch. 4 para. 45

47A [F2 Exemption for certain disposals under, or after leaving, cash basis] U.K.

(1) No chargeable gain shall accrue on the disposal of, or of an interest in, an asset if conditions [F3 A, B and D] are met in relation to the asset.

[F4 (2) Condition A is that the asset is not land.]

(3) Condition B is that, at any time during the period of ownership of the person making the disposal, the asset has been used for the purposes of a trade, profession[F5 , vocation or property business] carried on by the person.

F6 (4) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

[F7 (5) Condition D is that relevant disposal proceeds—

(a) are brought into account as a receipt (whether or not on the cash basis) under section 96A(3I) of ITTOIA 2005 in calculating the profits of a trade, profession or vocation (capital receipts under, or after leaving, cash basis: trades, professions and vocations), or

(b) are brought into account as a receipt (whether or not on the cash basis) under section 307E(12) of that Act in calculating the profits of a property business (capital receipts under, or after leaving, cash basis: property businesses).

(5A) “Relevant disposal proceeds” means disposal proceeds as mentioned in section 96A(3F) of ITTOIA 2005 or (as the case may be) section 307E(9) of that Act which arise from the disposal mentioned in subsection (1).]

[F8 (6) Subsection (7) applies in the case of the disposal of, or of an interest in, an asset—

(a) which, in the period of ownership of the person making the disposal—

(i) has been used partly for the purposes of the trade, profession or vocation and partly for other purposes, or

(ii) has been used for the purposes of the trade, profession or vocation for part of that period, or

(b) expenditure on which by the person has qualified in part only for capital allowances.]

(7) In such a case—

(a) the consideration for the disposal, and any expenditure attributable to the asset or interest by virtue of section 38(1)(a) and (b), shall be apportioned by reference to the extent to which that expenditure [F9 qualified for capital allowances],

(b) the computation of the gain shall be made separately in relation to the apportioned parts of the expenditure and consideration, and

(c) subsection (1) above shall apply to any gain accruing by reference to the computation in relation to the part of the consideration apportioned to use for the purposes of the trade, profession or vocation[F10 , or to the expenditure qualifying for capital allowances].

[F11 (8) In this section “property business” means a UK property business or an overseas property business within the meaning of Part 3 of ITTOIA 2005 (see sections 264 and 265 of that Act).]]

Textual Amendments

F2 S. 47A heading substituted (with effect in accordance with Sch. 2 para. 64 of the amending Act) by Finance (No. 2) Act 2017 (c. 32), Sch. 2 para. 46(2)

F3 Words in s. 47A(1) substituted (with effect in accordance with Sch. 2 para. 64 of the amending Act) by Finance (No. 2) Act 2017 (c. 32), Sch. 2 para. 46(3)

F4 S. 47A(2) substituted (with effect in accordance with Sch. 2 para. 64 of the amending Act) by Finance (No. 2) Act 2017 (c. 32), Sch. 2 para. 46(4)

F5 Words in s. 47A(3) substituted (with effect in accordance with Sch. 2 para. 64 of the amending Act) by Finance (No. 2) Act 2017 (c. 32), Sch. 2 para. 46(5)

F6 S. 47A(4) omitted (with effect in accordance with Sch. 2 para. 64 of the amending Act) by virtue of Finance (No. 2) Act 2017 (c. 32), Sch. 2 para. 46(6)

F7 S. 47A(5)(5A) substituted for s. 47A(5) (with effect in accordance with Sch. 2 para. 64 of the amending Act) by Finance (No. 2) Act 2017 (c. 32), Sch. 2 para. 46(7)

F8 S. 47A(6) substituted (with effect in accordance with Sch. 2 para. 64 of the amending Act) by Finance (No. 2) Act 2017 (c. 32), Sch. 2 para. 46(8)

F9 Words in s. 47A(7)(a) substituted (with effect in accordance with Sch. 2 para. 64 of the amending Act) by Finance (No. 2) Act 2017 (c. 32), Sch. 2 para. 46(9)(a)

F10 Words in s. 47A(7)(c) inserted (with effect in accordance with Sch. 2 para. 64 of the amending Act) by Finance (No. 2) Act 2017 (c. 32), Sch. 2 para. 46(9)(b)

F11 S. 47A(8) inserted (with effect in accordance with Sch. 2 para. 64 of the amending Act) by Finance (No. 2) Act 2017 (c. 32), Sch. 2 para. 46(10)

F12 47B Disposals made by persons after leaving cash basis U.K.

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Textual Amendments

F12 S. 47B omitted (with effect in accordance with Sch. 2 para. 64 of the amending Act) by virtue of Finance (No. 2) Act 2017 (c. 32), Sch. 2 para. 47