Taxation of Chargeable Gains Act 1992

[F1 Amount of gain or loss that is neither ATED-related nor an NRCGT gain or loss U.K.

Textual Amendments

F1 Sch. 4ZZB inserted (with effect in accordance with Sch. 7 para. 60 of the amending Act) by Finance Act 2015 (c. 11), Sch. 7 para. 39

16 (1) The gain or loss on the disposal of land (see paragraph 12(1)(b)) which is neither ATED-related nor an NRCGT gain or loss (“the balancing gain or loss”) is computed as follows. U.K.

• Step 1 Determine in accordance with paragraphs 17 to 19 the amount of the gain or loss accruing on each relevant high value disposal which is neither ATED-related nor an NRCGT gain or loss. This is the “balancing” gain or loss for each such disposal.

• Step 2 Add together the amounts of any balancing gains or losses determined under Step 1 (treating any amount which is a loss as a negative amount). If the result is a positive amount, that amount is the balancing gain on the disposal of land. If the result is a negative amount, that amount (expressed as a positive number) is the balancing loss on the disposal of land.

(2) In relation to a relevant high value disposal, “balancing day” means a day which is neither—

(a) a section 14D chargeable day (see paragraph 12(5)), nor

(b) an ATED chargeable day.

(3) In relation to a relevant high value disposal, “non-ATED chargeable day” means a day which is not an ATED chargeable day.

(4) The references in sub-paragraphs (2) and (3) to an “ATED chargeable day” are to be interpreted in accordance with paragraph 3(6) of Schedule 4ZZA.

17 (1) This paragraph applies in relation to a relevant high value disposal to which paragraph 13 applies. U.K.

F2 (2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(3) F3 ... The amount of the balancing gain or loss on the relevant high value disposal is found by adding—

(a) the amount of the balancing gain or loss belonging to the notional post-April 2015 gain or loss,

(b) the amount of the balancing gain or loss belonging to the notional pre-April 2015 gain or loss, and

(c) if P held the disposed of interest on 5 April 2013, the amount of the notional pre-April 2013 gain or loss,

(treating any amount which is a loss as a negative amount).

If the result is a positive amount, that amount is the balancing gain on the relevant high value disposal.

If the result is a negative amount, that amount (expressed as a positive number) is the balancing loss on the relevant high value disposal.

(4) The balancing gain or loss belonging to the notional post-April 2015 gain or loss is equal to the balancing fraction of the notional post-April 2015 gain or loss.

(5) The balancing gain or loss belonging to the notional pre-April 2015 gain or loss is equal to the non-ATED related fraction of the notional pre-April 2015 gain or loss.

(6) “The balancing fraction” is—

where—

“BD” is the number of balancing days (see paragraph 16(2)) in the appropriate ownership period;

“TD” is the total number of days in the appropriate ownership period.

(7) “The non-ATED related fraction” is—

where—

“NAD” is the number of non-ATED chargeable days (see paragraph 16(3)) in the appropriate ownership period;

“TD” is the total number of days in the appropriate ownership period.

(8) “Appropriate ownership period” means—

(a) for the purpose of computing the balancing gain or loss belonging to the notional post-April 2015 gain or loss, the post-commencement ownership period defined in paragraph 13(5);

(b) for the purpose of computing the balancing gain or loss belonging to the notional pre-April 2015 gain or loss, the relevant ownership period defined in paragraph 6A(11) of Schedule 4ZZA.

(9) In this paragraph—

(a) “notional post-April 2015 gain or loss” has the same meaning as in paragraph 13;

(b) “notional pre-April 2015 gain or loss” has the same meaning as in paragraph 6A of Schedule 4ZZA;

(c) “notional pre-April 2013 gain or loss” means the gain or loss which would have accrued on 5 April 2013 had the disposed of interest been disposed of for a consideration equal to the market value of that interest at that date.

Textual Amendments

F2 Sch. 4ZZB para. 17(2) omitted (with effect in accordance with s. 90(4) of the amending Act) by Finance Act 2016 (c. 24), s. 90(2)(a)

F3 Words in Sch. 4ZZB para. 17(3) omitted (with effect in accordance with s. 90(4) of the amending Act) by Finance Act 2016 (c. 24), s. 90(2)(b)

18 (1) In the case of a relevant high value disposal to which paragraph 14 applies, the amount of the balancing gain or loss is determined as follows. U.K.

(2) Determine the number of balancing days (see paragraph 16(2)) in the relevant ownership period.

(3) The balancing gain or loss on the disposal is equal to the balancing fraction of the amount of the gain or (as the case may be) loss determined under Step 1 of paragraph 14(3).

(4) “The balancing fraction” is—

where—

“BD” is the number of balancing days in the relevant ownership period;

“TD” is the total number of days in the relevant ownership period.

(5) In this paragraph “relevant ownership period” has the same meaning as in paragraph 14.

19 (1) The amount of the balancing gain or loss on a relevant high value disposal to which paragraph 15 applies is found by adding— U.K.

(a) the amount of the balancing gain or loss belonging to the notional post-April 2016 gain or loss,

(b) the amount of the balancing gain or loss belonging to the notional pre-April 2016 gain or loss, and

(c) if P held the disposed of interest on 5 April 2015, the amount of the notional pre-April 2015 gain or loss,

(treating any amount which is a loss as a negative amount).

If the result is a positive amount, that amount is the balancing gain on the relevant high value disposal.

If the result is a negative amount, that amount (expressed as a positive number) is the balancing loss on the relevant high value disposal.

(2) The balancing gain or loss belonging to the notional post-April 2016 gain or loss is equal to the balancing fraction of the notional post-April 2016 gain or loss.

(3) The balancing gain or loss belonging to the notional pre-April 2016 gain or loss is equal to the balancing fraction of the notional pre-April 2016 gain or loss.

(4) “The balancing fraction” is—

where—

“BD” is the number of balancing days (see paragraph 16(2)) in the appropriate ownership period;

“TD” is the total number of days in the appropriate ownership period.

(5) The appropriate ownership period is—

(a) for the purpose of computing the balancing gain or loss belonging to the notional post-April 2016 gain or loss, the relevant ownership period mentioned in paragraph 15(4)(a);

(b) for the purpose of computing the balancing gain or loss belonging to the notional pre-April 2016 gain or loss, the relevant ownership period mentioned in paragraph 15(4)(b).

(6) In this paragraph—

(a) “notional post-April 2016 gain or loss” and “notional pre-April 2016 gain or loss” mean the same as in paragraph 15;

(b) “notional pre-April 2015 gain or loss” means the gain or loss which would have accrued on 5 April 2015 if the disposed of interest had been disposed of for a consideration equal to the market value of that interest on that date.]