Part I U.K. Capital gains tax and corporation tax on chargeable gains

Capital gains tax U.K.

[F1 2D “The threshold amount” U.K.

(1) This section applies to determine “the threshold amount” in relation to a disposal which meets Conditions A to C in section 2C (“the current disposal”).

(2) If—

(a) the current disposal is not a part disposal of an asset, and

(b) P has not made any relevant related disposals,

the threshold amount is [F2 £500,000], subject to subsection (5) (joint interests).

(3) If paragraphs (a) and (b) of subsection (2) do not both apply, the threshold amount is the relevant fraction of [F3 £500,000], subject to subsection (5) (joint interests).

(4) “The relevant fraction” is—

where—

“C” is the amount or value of the consideration for the current disposal;

“TMV” is what would be the market value, at the time of the current disposal, of a notional asset comprising—

(a)

the disposed of interest (see section 2C(2)),

(b)

if the current disposal is a part disposal, any part of the chargeable interest held by P that remains undisposed of immediately following that part disposal,

(c)

any chargeable interest (or part of a chargeable interest) which was the subject of a relevant related disposal, and

(d)

any chargeable interest (or part of a chargeable interest) held by P at the time of the current disposal which, if P had disposed of it at that time, would have been the subject of a relevant related disposal.

(5) If the disposed of interest is a share of the whole of—

(a) a chargeable interest, or

(b) a part of a chargeable interest,

subsections (2) and (3) have effect as if the references to [F4 “£500,000”] were to the joint share fraction of that amount.

(6) The joint share fraction is the fraction of the whole of the chargeable interest or part represented by the disposed of interest.

(7) “Relevant related disposal”, in relation to the current disposal, means any disposal by P which—

(a) meets Conditions A to C in section 2C in circumstances where the single-dwelling interest referred to in Condition C is—

(i) the single-dwelling interest by virtue of which Condition C is met in relation to the current disposal, or

(ii) another single-dwelling interest in the same dwelling as that interest, and

(b) was made in the period of 6 years ending with the day on which the current disposal occurs, but not before 6 April 2013.]

Textual Amendments

F1 Ss. 2B-2F inserted (with effect in accordance with Sch. 25 para. 20 of the amending Act) by Finance Act 2013 (c. 29), Sch. 25 para. 4

F2 Sum in s. 2D(2) substituted (with effect in relation to disposals occurring on or after 6 April 2016 in accordance with Sch. 8 para. 4(5) of the amending Act) by Finance Act 2015 (c. 11), Sch. 8 para. 4(2)

F3 Sum in s. 2D(3) substituted (with effect in relation to disposals occurring on or after 6 April 2016 in accordance with Sch. 8 para. 4(5) of the amending Act) by Finance Act 2015 (c. 11), Sch. 8 para. 4(3)

F4 Sum in s. 2D(5) substituted (with effect in relation to disposals occurring on or after 6 April 2016 in accordance with Sch. 8 para. 4(5) of the amending Act) by Finance Act 2015 (c. 11), Sch. 8 para. 4(4)