SCHEDULES

F1SCHEDULE 1AAssets deriving 75% of value from UK land etc

Annotations:
Amendments (Textual)
F1

Sch. 1A inserted (with effect in accordance with Sch. 1 paras. 120, 123 of the amending Act) by Finance Act 2019 (c. 1), Sch. 1 para. 14

PART 2Whether asset derives at least 75% of its value from UK land

The basic rule

3

1

An asset derives at least 75% of its value from UK land if—

a

the asset consists of a right or an interest in a company, and

b

at the time of the disposal, at least 75% of the total market value of the company's qualifying assets derives (directly or indirectly) from interests in UK land.

2

Market value may be traced through any number of companies, partnerships, trusts and other entities or arrangements but may not be traced through a normal commercial loan.

3

It is irrelevant whether the law under which a company, partnership, trust or other entity or an arrangement is established or has effect is—

a

the law of any part of the United Kingdom, or

b

the law of any territory outside the United Kingdom.

4

The assets held by a company, partnership or trust or other entity or arrangement must be attributed to the shareholders, partners, beneficiaries or other participants at each stage in whatever way is appropriate in the circumstances.

5

For the purposes of this paragraph—

  • normal commercial loan” means a loan which is a normal commercial loan for the purposes of section 158(1)(b) or 159(4)(b) of CTA 2010, and

  • qualifying assets” has the meaning given by paragraph 4.

6

The provision made by this paragraph is subject to exceptions provided by—

a

paragraph 5 (interests in UK land used for trading purposes), and

b

paragraph 6 (certain disposals of rights or interests in connected companies).