Part 7Income tax, corporation tax and capital gains tax: general
Chargeable gains
160Taper relief: assets qualifying as business assets
1
In Schedule A1 to the Taxation of Chargeable Gains Act 1992 (taper relief), paragraph 5 (conditions for assets other than shares to qualify as business assets) is amended as follows.
2
In sub-paragraph (1)
(application of paragraph), after “in the case of the disposal of any asset” insert “
by an individual, the trustees of a settlement or an individual’s personal representatives
”
.
3
For sub-paragraphs (2) to (5) substitute—
1A
The asset was a business asset at that time if at that time it was being used, wholly or partly, for the purposes of a trade carried on by—
a
an individual or a partnership of which an individual was at that time a member, or
b
the trustees of a settlement or a partnership whose members at that time included—
i
the trustees of a settlement, or
ii
any one or more of the persons who at that time were the trustees of a settlement (so far as acting in their capacity as trustees), or
c
the personal representatives of a deceased person or a partnership whose members at that time included—
i
the personal representatives of a deceased person, or
ii
any one or more of the persons who at that time were the personal representatives of a deceased person (so far as acting in their capacity as personal representatives).
2
Where the disposal is made by an individual, the asset was a business asset at that time if at that time it was being used, wholly or partly, for the purposes of a trade carried on by—
a
a company which at that time was a qualifying company by reference to that individual,
b
a company which at that time was a member of a trading group the holding company of which was at that time a qualifying company by reference to that individual, or
c
a partnership whose members at that time included a company within paragraph (a) or (b),
or for the purposes of any office or employment held by that individual with a person carrying on a trade.
3
Where the disposal is made by the trustees of a settlement, the asset was a business asset at that time if at that time it was being used, wholly or partly, for the purposes of a trade carried on by—
a
a company which at that time was a qualifying company by reference to the trustees of the settlement or an eligible beneficiary,
b
a company which at that time was a member of a trading group the holding company of which was at that time a qualifying company by reference to the trustees of the settlement or an eligible beneficiary, or
c
a partnership whose members at that time included a company within paragraph (a) or (b),
or for the purposes of any office or employment held by an eligible beneficiary with a person carrying on a trade.
4
Where the disposal is made by an individual’s personal representatives, the asset was a business asset at that time if at that time it was being used, wholly or partly, for the purposes of a trade carried on by—
a
a company which at that time was a qualifying company by reference to the deceased’s personal representatives,
b
a company which at that time was a member of a trading group the holding company of which was at that time a qualifying company by reference to the deceased’s personal representatives, or
c
a partnership whose members at that time included a company within paragraph (a) or (b).
5
Where the disposal is made by an individual who acquired the asset as legatee (as defined in section 64), the asset shall be taken to have been a business asset at that time if at that time it was—
a
being held by the personal representatives of the deceased, and
b
being used, wholly or partly, for the purposes of a trade carried on by—
i
a company which at that time was a qualifying company by reference to the deceased’s personal representatives,
ii
a company which at that time was a member of a trading group the holding company of which was at that time a qualifying company by reference to the deceased’s personal representatives, or
iii
a partnership whose members at that time included a company within sub-paragraph (i) or (ii).
4
The following amendments in Schedule A1 to the Taxation of Chargeable Gains Act 1992 (c. 12) are consequential on those above—
a
in paragraphs 9(1)(a) and 19(1) for “paragraph 5(2) to (5)” substitute “
any provision of paragraph 5
”
;
b
in paragraph 15(4)(a) for “paragraph 5(2)” substitute “
paragraph 5(1) and (2)
”
.
5
The amendments in this section apply to disposals on or after 6th April 2004 and as they so apply have effect in relation to periods of ownership on or after that date.