Part II General Provisions relating to computation of gains and acquisitions and disposals of assets
Chapter III Computation of gains: General provisions
F1Cash basis accounting
47AF2Exemption for certain disposals under, or after leaving, cash basis
1
No chargeable gain shall accrue on the disposal of, or of an interest in, an asset if conditions F3A, B and D are met in relation to the asset.
F42
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, professionF5, vocation or property business carried on by the person.
F64
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F75
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).
F86
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 F9qualified 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 vocationF10, or to the expenditure qualifying for capital allowances.
F118
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).
F1247BDisposals made by persons after leaving cash basis
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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