17(1)Section 36 of the Taxes Act 1988 (charge on sale of land with right to reconveyance) is amended as follows.E+W+S+N.I.
(2)In the sidenote for “Schedule D charge" substitute “ Charge ”.
(3)In subsection (1)—
(a)for “the vendor shall be chargeable to tax under Case VI of Schedule D on" substitute “ the following amount shall be deemed to have been received as income by the vendor and to have been received by him in consequence of his having entered into a transaction falling to be treated as mentioned in paragraph 1(2) of Schedule A, that is to say ”; and
(b)for “on that excess" substitute “ the amount of the excess ”.
(4)After subsection (4) insert—
“(4A)An amount deemed under this section to have been received as income by the vendor—
(a)is treated as received when the estate or interest is sold, and
(b)shall be taken into account in computing the profits of the Schedule A business in question for the chargeable period in which it is treated as received.
(4B)For the purposes of subsection (4A)(a) an estate or interest in land is treated as sold when any of the following occurs—
(a)an unconditional contract for its sale is entered into,
(b)a conditional contract for its sale becomes unconditional, or
(c)an option or right of pre-emption is exercised requiring the vendor to enter into an unconditional contract for its sale.”.