Taxation of Chargeable Gains Act 1992

[F1 Cases where there are non-qualifying beneficiaries U.K.

Textual Amendments

F1 Sch. A1 inserted (with effect in accordance with s. 121(4) of the amending Act) by Finance Act 1998 (c. 36), s. 121(2), Sch. 20

8 (1) This paragraph applies in the case of a disposal of an asset by the trustees of a settlement where the asset’s relevant period of ownership is or includes a period (“a sharing period") throughout which— U.K.

(a) the asset was a business asset by reference to one or more eligible beneficiaries;

(b) the asset would not otherwise have been a business asset; and

(c) there is a non-qualifying part of the relevant income, or there would be if there were any relevant income for that period.

(2) The period throughout which the asset disposed of is to be taken to have been a business asset shall be determined as if the relevant fraction of every sharing period were a period throughout which the asset was not a business asset.

(3) In sub-paragraph (2) above “the relevant fraction”, in relation to any sharing period, means the fraction which represents the proportion of relevant income for that period which is, or (if there were such income) would be, a non-qualifying part of that income.

(4) Where a sharing period is a period in which the proportion mentioned in sub-paragraph (3) above has been different at different times, this paragraph shall require a separate relevant fraction to be determined for, and applied to, each part of that period for which there is a different proportion.

(5) For the purposes of this paragraph the non-qualifying part of any relevant income for any period is so much of that income for that period as is or, as the case may be, would be—

(a) income to which no eligible beneficiary has any entitlement; or

(b) income to which a non-qualifying eligible beneficiary has an entitlement.

(6) In sub-paragraph (5) above “non-qualifying eligible beneficiary”, in relation to a period, means an eligible beneficiary who is not a beneficiary by reference to whom (if he were the only beneficiary) the asset disposed of would be a business asset throughout that period.

(7) In this paragraph “relevant income” means income from the part of the settled property comprising the asset disposed of.]