Income Tax Act 2007

Entitlement to relief

431 Relief for gifts of shares, securities and real property to charities etc

(1) An individual who disposes of the whole of the beneficial interest in a qualifying investment (see section 432) to a charity is entitled to relief if—

(a) the disposal is otherwise than by way of a bargain made at arm’s length, and

(b) the individual makes a claim.

(2) The relief is given by deducting the relievable amount in calculating the individual’s net income for the tax year in which the disposal is made (see Step 2 of the calculation in section 23).

(3) For the calculation of the relievable amount, see section 434.

(4) If the qualifying investment is a qualifying interest in land (see section 433), this section is subject to—

• section 441 (certificates),

• section 442 (qualifying interests in land held jointly),

• section 443 (calculation of relievable amount where joint disposal), and

• section 444 (disqualifying events).

(5) See section 446 for bodies that are treated as charities for the purposes of this Chapter.

(6) See subsection (7) of section 535 of ITTOIA 2005 (top slicing relief) for provision about how relief under this Chapter is to be ignored for the purpose of calculating relief under that section.

432 Meaning of “qualifying investment”

(1) In this Chapter “qualifying investment” means—

(a) shares or securities which are listed or dealt in on a recognised stock exchange,

(b) units in an authorised unit trust,

(c) shares in an open-ended investment company,

(d) an interest in an offshore fund, and

(e) a qualifying interest in land.

(2) In this section—

• “offshore fund” has the same meaning as in Chapter 5 of Part 17 of ICTA (see sections 756A to 756C of that Act), and

• “open-ended investment company” is to be read in accordance with section 468A(2) to (4) of ICTA.

433 Meaning of “qualifying interest in land”

(1) In this Chapter “qualifying interest in land” means—

(a) a freehold interest in land in the United Kingdom, or

(b) a leasehold interest in land in the United Kingdom which is a term of years absolute.

This is subject to subsections (2) to (5).

(2) Subsection (3) applies if an individual with a beneficial interest in a freehold or leasehold interest mentioned in subsection (1)(a) or (b) makes a disposal to a charity of—

(a) the whole of the beneficial interest, and

(b) an easement, servitude, right or privilege so far as benefiting the land in question.

(3) The disposal mentioned in subsection (2)(b) is regarded for the purposes of this Chapter as a disposal by the individual of the whole of the individual’s beneficial interest in a qualifying interest in land separate from the disposal mentioned in subsection (2)(a).

(4) If an individual who has a freehold or leasehold interest in land in the United Kingdom grants a lease for a term of years absolute to a charity of the whole or part of that land, the grant of the lease is regarded for the purposes of this Chapter as a disposal by the individual of the whole of the beneficial interest in the leasehold interest so granted.

(5) Neither an agreement to acquire a freehold interest nor an agreement for a lease is a qualifying interest in land.

(6) In the application of this section to Scotland—

(a) references to a freehold interest in land are to the interest of the owner,

(b) references to a leasehold interest in land which is a term of years absolute are to a tenant’s right over or interest in a property subject to a lease,

(c) references to an agreement for a lease do not include missives of let that constitute an actual lease, and

(d) in subsection (4) the reference to granting a lease for a term of years absolute is to granting a lease.