Capital Gains Tax Act 1979 (repealed 6.3.1992)

Land: allowance for betterment levy U.K.

21 (1) Where betterment levy charged in the case of any land in respect of an act or event falling within Case B or Case C or, if it was the renewal, extension or variation of a tenancy, Case F—

(a) has been paid, and

(b) has not been allowed as a deduction in computing the profits or gains or losses of a trade for the purposes of Case I of Schedule D;

then, if the person by whom the levy was paid disposes of the land or any part of it and so claims, the following provisions of this paragraph shall have effect for the purpose of applying Chapter II of Part II of, and Schedule 5 to, this Act to the disposal.

(2) Paragraph 9 of Schedule 5 to this Act (sales of land reflecting development value) shall apply where the condition stated in subparagraph (1)(a) thereof is satisfied, notwithstanding that the condition stated in sub-paragraph (1)(b) thereof is not satisfied.

(3) Subject to the following provisions of this paragraph, there shall be ascertained the excess, if any, of—

(a) the net development value ascertained for the purposes of the levy, over

(b) the increment specified in sub-paragraph (6) below;

and the amount of the excess shall be treated as an amount allowable under section 32(1)(b) of this Act.

(4) Where the act or event in respect of which the levy was charged was a part disposal of the land, the said section 32 shall apply as if the part disposal had not taken place and sub-paragraph (5) below shall apply in lieu of sub-paragraph (3) above.

(5) The amount or value of the consideration for the disposal shall be treated as increased by the amount of any premium or like sum paid in respect of the part disposal, and there shall be ascertained the excess, if any, of—

(a) the aggregate specified in sub-paragraph (7) below, over

(b) the increment specified in sub-paragraph (6) below;

and the amount of the excess shall be treated as an amount allowable under section 32(1)(b) of this Act.

(6) The increment referred to in sub-paragraphs (3)(b) and (5)(b) above is the excess, if any, of—

(a) the amount or value of the consideration brought into account under section 32 (1)(a) of this Act, over

(b) the base value ascertained for the purposes of the levy.

(7) The aggregate referred to in sub-paragraph (5)(a) above is the aggregate of—

(a) the net development value ascertained for the purposes of the levy, and

(b) the amount of any premium or like sum paid in respect of the part disposal, in so far as charged to tax under Schedule A (or, as the case may be, Case VIII of Schedule D), and

(c) the chargeable gain accruing on the part disposal.

(8) Where betterment levy in respect of more than one act or event has been charged and paid as mentioned in sub-paragraph (1) above sub-paragraphs (2) to (7) above shall apply without modifications in relation to the betterment levy in respect of the first of them; but in relation to the other or others sub-paragraph (3) or, as the case may be, (5) above shall have effect as if the amounts to be treated thereunder as allowable under section 32(1)(b) of this Act were the net development value specified in sub-paragraph (3)(a) or, as the case may be, the aggregate referred to in sub-paragraph (5)(a) of this paragraph.

(9) Where the disposal is of part only of the land sub-paragraphs (2) to (8) above shall have effect subject to the appropriate apportionments.

(10) References in this paragraph to a premium include any sum payable as mentioned in subsection (3) or (4) of section 80 of [F1 the Taxes Act 1970] (sums payable in lieu of rent or as consideration for the surrender of lease or for variation or waiver of term) and, in relation to Scotland, a grassum.

Textual Amendments

F1 Words substituted by Income and Corporation Taxes Act 1988 (c. 1, SIF 63:1), Sch. 29 para. 15