Part II General Provisions relating to computation of gains and acquisitions and disposals of assets
Chapter IV Computation of gains: the indexation allowance
General
53 The indexation allowance and interpretative provisions.
1
Subject to any provision to the contrary, F1if on the disposal of an asset there is an unindexed gain, an allowance (“the indexation allowance”) shall be allowed against the unindexed gain—
a
so as to give the gain for the purposes of this Act, or
b
if the indexation allowance equals or exceeds the unindexed gain, so as to extinguish it (in which case the disposal shall be one on which, after taking account of the indexation allowance, neither a gain nor a loss accrues);
and any reference in this Act to an indexation allowance or to the making of an indexation allowance shall be construed accordingly.
F61A
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2
For the purposes of F2this Chapter, in relation to any disposal of an asset—
F3a
“unindexed gain” means the amount of the gain on the disposal computed in accordance with this Part; and
b
“relevant allowable expenditure” means, subject to subsection (3) below, any sum which, in the computation of the unindexed F4gain was taken into account by virtue of paragraph (a) or paragraph (b) of section 38(1).
F52A
Notwithstanding anything in section 16 of this Act, this section shall not apply to a disposal on which a loss accrues.
3
In determining what sum (if any) was taken into account as mentioned in subsection (2)(b) above, account shall be taken of any provision of any enactment which, for the purpose of the computation of the gain, increases, excludes or reduces the whole or any part of any item of expenditure falling within section 38 or provides for it to be written-down.
4
Sections 54 and 108 and this section have effect subject to sections 56, 57, 109, 110 F7... , 113, 131 and 145.