CG60201 - Reliefs: Introduction and Order of Reliefs

The disposal of particular assets may attract full or partial relief from Capital Gains Tax. These volumes deal with

  • roll-over relief for the replacement of business assets, see CG60250+ 
  • roll-over relief for the replacement of land by local constituency associations of political parties on reorganisations of constituencies, see CG61800+ 
  • roll-over relief for the replacement of land acquired by an authority having powers of compulsory purchase, see CG61900+ 
  • roll-over relief on a transfer of shares to an All Employee Share Ownership Trust, see CG61970+ 
  • private residence relief on a disposal of a person's only or main residence, see CG64200+ 
  • relief on the transfer of a business to a company, see CG65700+ 
  • relief for losses on loans to traders or for payments under a guarantee, see CG65900+ 
  • double taxation relief on the disposal of assets where foreign tax is paid, see CG14380 
  • hold-over relief on gifts, see CG66450+.

Particular types of organisation are exempt from Capital Gains Tax on the disposal of certain assets. The next part of Volume 7 deals with

Order of reliefs

Where reliefs are available in respect of discrete types of asset no confusion can arise about their interaction. However, particularly in relation to business assets, a number of different reliefs may be available. The order in which such reliefs should be allowed depends on the way in which they work.

  • Roll-over relief (TCGA92/S152 - TCGA92/S158) reduces the consideration to be taken into account in computing the gain on disposal. This comes first.
  • Relief on the transfer of a business to a company (TCGA92/S162) works by reducing the net chargeable gains.
  • Relief for gifts of business assets (TCGA92/S165) also works by reducing the chargeable gains

Where reliefs are available in respect of discrete types of asset no confusion can arise about their interaction. But, particularly in relation to business assets, a number of different reliefs may be available. The order in which such reliefs should be allowed depends on the way in which they work.

ROLL-OVER RELIEF (TCGA92/S152 - TCGA92/S158) reduces the consideration to be taken into account in computing the gain on disposal.

RELIEF ON THE TRANSFER OF A BUSINESS TO A COMPANY (TCGA92/S162) works by reducing the net chargeable gains.

RELIEF FOR GIFTS OF BUSINESS ASSETS (TCGA92/S165) also works by reducing the chargeable gains. Instructions on the interaction of this relief with the relief on transfer of a business to a company are at CG66973.