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Taxation of Chargeable Gains Act 1992

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Part IIOther transitory provisions

Value-shifting

10(1)Section 30 applies only where the reduction in value mentioned in subsection (1) of that section (or, in a case within subsection (9) of that section, the reduction or increase in value) is after 29th March 1977.

(2)No account shall be taken by virtue of section 31 of any reduction in the value of an asset attributable to the payment of a dividend before 14th March 1989.

(3)No account shall be taken by virtue of section 32 of any reduction in the value of an asset attributable to the disposal of another asset before 14th March 1989.

(4)Section 34 shall not apply where the reduction in value, by reason of which the amount referred to in subsection (1)(b) of that section falls to be calculated, occurred before 14th March 1989.

Assets acquired on disposal chargeable under Case VII of Schedule D

11(1)In this paragraph references to a disposal chargeable under Case VII are references to cases where the acquisition and disposal was in circumstances that the gain accruing on it was chargeable under Case VII of Schedule D, or where it would have been so chargeable if there were a gain so accruing.

(2)The amount or value of the consideration for the acquisition of an asset by the person acquiring it on a disposal chargeable under Case VII shall not under any provision of this Act be deemed to be an amount greater than the amount taken into account as consideration on that disposal for the purposes of Case VII.

(3)Any apportionment of consideration or expenditure falling to be made in relation to a disposal chargeable under Case VII in accordance with section 164(4) of the [1970 c. 10.] Income and Corporation Taxes Act 1970, and in particular in a case where section 164(6) of that Act (enhancement of value of land by acquisition of adjoining land) applied, shall be followed for the purposes of this Act both in relation to a disposal of the assets acquired on the disposal chargeable under Case VII and, where the disposal chargeable under Case VII was a part disposal, in relation to a disposal of what remains undisposed of.

(4)Sub-paragraph (3) above has effect notwithstanding section 52(4).

Unrelieved Case VII losses

12Where no relief from income tax (for a year earlier than 1971-72) has been given in respect of a loss or part of a loss allowable under Case VII of Schedule D, the loss or part shall, notwithstanding that the loss accrued before that year, be an allowable loss for the purposes of capital gains tax, but subject to any restrictions imposed by section 18.

Devaluation of sterling: securities acquired with borrowed foreign currency

13(1)This paragraph applies where, in pursuance of permission granted under the [1947 c. 14.] Exchange Control Act 1947, currency other than sterling was borrowed before 19th November 1967 for the purpose of investing in foreign securities (and had not been repaid before that date), and it was a condition of the permission—

(a)that repayment of the borrowed currency should be made from the proceeds of the sale in foreign currency of the foreign securities so acquired or out of investment currency, and

(b)that the foreign securities so acquired should be kept in separate accounts to distinguish them from others in the same ownership,

and securities held in such a separate account on 19th November 1967 are in this paragraph referred to as “designated securities”.

(2)In computing the gain accruing to the borrower on the disposal of any designated securities or on the disposal of any currency or amount standing in a bank account on 19th November 1967 and representing the loan, the sums allowable as a deduction under section 38(1)(a) shall, subject to sub-paragraph (3) below, be increased by multiplying them by seven-sixths.

(3)The total amount of the increases so made in computing all gains (and losses) which are referable to any one loan (made before 19th November 1967) shall not exceed one-sixth of the sterling parity value of that loan at the time it was made.

(4)Designated securities which on the commencement of this paragraph constitute a separate 1982 holding (within the meaning of section 109), shall continue to constitute a separate 1982 holding until such time as a disposal takes place on the occurrence of which sub-paragraph (3) above operates to limit the increases which would otherwise be made under sub-paragraph (2) in allowable deductions.

(5)In this paragraph and paragraph 14 below, “foreign securities” means securities expressed in a currency other than sterling, or shares having a nominal value expressed in a currency other than sterling, or the dividends on which are payable in a currency other than sterling.

Devaluation of sterling: foreign insurance funds

14(1)The sums allowable as a deduction under section 38(1)(a) in computing any gains to which this paragraph applies shall be increased by multiplying by seven-sixths.

(2)This paragraph applies to gains accruing—

(a)to any underwriting member of Lloyd's, or

(b)to any company engaged in the business of marine protection and indemnity insurance on a mutual basis,

on the disposal by that person after 18th November 1967 of any foreign securities which on that date formed part of a trust fund—

(i)established by that person in any country or territory outside the United Kingdom, and

(ii)representing premiums received in the course of that person’s business, and

(iii)wholly or mainly used for the purpose of meeting liabilities arising in that country or territory in respect of that business.

Gilt-edged securities past redemption date

15So far as material for the purposes of this or any other Act, the definition of “gilt-edged securities” in Schedule 9 to this Act shall include any securities which were gilt-edged securities for the purposes of the 1979 Act, and the redemption date of which fell before 1st January 1992.

Qualifying corporate bonds, company reorganisations, share conversions etc.

16(1)Part IV of this Act has effect subject to the provisions of this paragraph.

(2)The substitution of Chapter II of that Part for the enactments repealed by this Act shall not alter the law applicable to any reorganisation or reduction of share capital, conversion of securities or company amalgamation taking place before the coming into force of this Act.

(3)Sub-paragraph (2) above applies in particular to the law determining whether or not any assets arising on an event mentioned in that sub-paragraph are to be treated as the same asset as the original holding of shares, securities or other assets.

(4)In relation to a disposal or exchange on or after 6th April 1992, the following amendments shall be regarded as always having had effect, that is to say, the amendments to section 64 of, or Schedule 13 to, the [1984 c. 43.] Finance Act 1984 made by section 139 of, or paragraph 6 of Schedule 14 to, the [1989 c. 26.] Finance Act 1989, paragraph 28 of Schedule 10 to the Finance Act 1990 or section 98 of, or paragraph 1 of Schedule 10 to, the [1991 c. 31.] Finance Act 1991, or by virtue of the amendments to paragraph 1 of Schedule 18 to the Taxes Act made by section 77 of the [1991 c. 31.] Finance Act 1991.

Land: allowance for betterment levy

17(1)Where betterment levy charged in the case of any land in respect of an act or event which fell 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.

(2)Paragraph 9 of Schedule 2 shall apply where the condition stated in sub-paragraph (1)(a) of that paragraph is satisfied, notwithstanding that the condition in sub-paragraph (1)(b) of that paragraph 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 38(1)(b).

(4)Where the act or event in respect of which the levy was charged was a part disposal of the land, section 38 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 38(1)(b).

(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 38(1)(a), 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 38(1)(b) were the net development value specified in sub-paragraph (3)(a) or, as the case may be, the aggregate referred to in subparagraph (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 section 34(4) or (5) of the Taxes Act (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.

Non-resident trusts

18Without prejudice to section 289 or Part III of this Schedule—

(a)any tax chargeable on a person which is postponed under subsection (4)(b) of section 17 of the 1979 Act shall continue to be postponed until that person becomes absolutely entitled to the part of the settled property concerned or disposes of the whole or part of his interest, as mentioned in that subsection; and

(b)section 70 of and Schedule 14 to the [1984 c. 43] Finance Act 1984 shall continue to have effect in relation to amounts of tax which are postponed under that Schedule, and accordingly in paragraph 12 of that Schedule the references to section 80 of the [1981 c. 35.] Finance Act 1981 and to subsections (3) and (4) of that section include references to section 87 of this Act and subsections (4) and (5) of that section respectively.

Private residences

19The reference in section 222(5)(a) to a notice given by any person within 2 years from the beginning of the period mentioned in section 222(5) includes a notice given before the end of the year 1966-67, if that was later.

Works of art etc.

20The repeals made by this Act do not affect the continued operation of sections 31 and 32 of the [1965 c. 25] Finance Act 1965, in the form in which they were before 13th March 1975, in relation to estate duty in respect of deaths occurring before that date.

Disposal before acquisition

21The substitution of this Act for the corresponding enactments repealed by this Act shall not alter the effect of any provision enacted before this Act (whether or not there is a corresponding provision in this Act) so far as it relates to an asset which—

(a)was disposed of before being acquired, and

(b)was disposed of before the commencement of this Act.

Estate duty

22Nothing in the repeals made by this Act shall affect any enactment as it applies to the determination of any principal value for the purposes of estate duty.

Validity of subordinate legislation

23So far as this Act re-enacts any provision contained in a statutory instrument made in exercise of powers conferred by any Act, it shall be without prejudice to the validity of that provision, and any question as to its validity shall be determined as if the re-enacted provision were contained in a statutory instrument made under those powers.

Amendments in other Acts

24(1)The repeal by this Act of the [1970 c. 10.] Income and Corporation Taxes Act 1970 does not affect—

(a)the amendment made by paragraph 3 of Schedule 15 of that Act to section 26 of the [1956 c. 54.] Finance Act 1956, or

(b)paragraph 10 of that Schedule so far it applies in relation to the Management Act.

(2)The repeal by this Act of Schedule 7 to the 1979 Act does not affect the amendments made by that Schedule to any enactment not repealed by this Act.

Saving for Part III of this Schedule

25The provisions of this Part of this Schedule are without prejudice to the generality of Part III of this Schedule.

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