Income and Corporation Taxes Act 1988

[F1 9 (1) This paragraph applies where—

(a) any determination falls to be made under section 432A of the category of business to which any income or losses is or are referable; and

(b) that income or those losses would all be chargeable or relievable by virtue of this Schedule but for the exemptions from tax and exclusions from the provisions of this Schedule that are applicable in respect of the category of business to which it or they are determined to be referable.

(2) Section 432A shall have effect] as if (where that would not otherwise be the case)—

(a) any such income were for the purposes of that section a gain accruing on the disposal of an asset; and

(b) any such loss were for the purposes of that section a loss accruing on the disposal of an asset.

[F2 (3) Subject to sub-paragraphs (4) and (5) below, paragraph 4A above shall have effect as if the references in sub-paragraph (5) of that paragraph to—

(a) profits or gains arising from the deemed transaction that are chargeable to tax under Case VI of Schedule D in accordance with paragraph 1(1) above, or

(b) any loss arising in the deemed transaction that is brought into account for the purposes of section 392 or 396 in accordance with paragraph 1(5) above,

were references to all the income or losses in relation to which the determination mentioned in sub-paragraph (1) above falls to be made.

(4) Sub-paragraph (6) of paragraph 4A above shall not apply in relation to the amount of the consideration for the acquisition of any asset acquired by the taxpayer by means of the future running to delivery or, as the case may be, by the exercise of the option if—

(a) immediately before the time of the deemed transaction, the future or option is an asset within one of the categories set out in section 440(4); and

(b) immediately after its acquisition, the asset acquired is within another of those categories.

(5) Sub-paragraph (6) of paragraph 4A above shall not apply in relation to the amount of the consideration for the acquisition of any asset disposed of by the taxpayer by means of the future running to delivery or, as the case may be, by the exercise of the option if—

(a) immediately before the time of the deemed transaction, the future or option is an asset within one of the categories set out in section 440(4); and

(b) immediately before its disposal, the asset disposed of is within another of those categories.

(6) Where any future or option would not fall (apart from this sub-paragraph) to be treated as an asset for the purposes of section 440, any question for the purposes of this paragraph whether it is an asset within any of the categories set out in subsection (4) of that section shall be determined as if it were an asset.

(7) Expressions used in this paragraph and in paragraph 4A above have the same meanings in this paragraph as in that paragraph.]

Textual Amendments

F1 Words in Sch. 5AA para. 9 substituted (with effect in accordance with s. 99(5) of the amending Act) by Finance Act 1998 (c. 36), s. 99(2)

F2 Sch. 5AA para. 9(3)-(7) inserted (with effect in accordance with s. 99(5) of the amending Act) by Finance Act 1998 (c. 36), s. 99(3)