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Capital sums derived from assets
01/02/2024

HMRC’s guidance is clear that where a capital sum is derived from an asset, the relevant legislation treats the owner as having made a disposal for capital gains purposes.

The legislation contained in s22 TCGA92 states that there is:

“…..a disposal of assets by their owner where any capital sum is derived from assets notwithstanding that no asset is acquired by the person paying the capital sum…..”

There are occasions when a person may receive a capital sum even though a natural disposal of an asset has not occurred, for example, on receiving compensation for damage to an asset or a sum of money from another person for the right to use or exploit an asset.

HMRC’s internal manual states that as the word ‘disposal’ is not expressly defined in TCGA92 it must be given its normal everyday meaning. Therefore, disposals for capital gains purposes include natural disposals and part disposals of assets.


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Cameron Baum Hollander is the trading name of Cameron Baum Hollander Limited. Cameron Baum Hollander Limited is a limited liability company.

Company Number: 04631085

Registered Office: 88 Crawford Street, London, W1H 2EJ

ICAEW Number: C001006629

VAT Number: 814 8108 39

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Cameron Baum Hollander
88 Crawford Street
London
W1H 2EJ
partners@cbh.co.uk
020 7724 8824
https://cbh.co.uk/

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