Corporation Tax Act 2009 section 669

Meaning of G and L in sections 667 and 668

Section 669 defines the values G and L, which are used in sections 667 and 668 to adjust the allowable acquisition cost of shares for chargeable gains purposes when those shares were acquired through exercising a derivative contract option or through a futures contract running to delivery.

• G represents the total non-trading credits brought into account under section 574 in respect of the derivative contract, apportioned on a just and reasonable basis to the shares acquired
• L represents the total non-trading debits brought into account under section 574 in respect of the derivative contract, similarly apportioned to the shares acquired
• Only non-trading credits and debits are relevant — trading amounts under section 573 are excluded because those profits and losses are already taxed as trading income rather than as chargeable gains
• The relevant accounting periods from which credits and debits are drawn cover any period up to and including the one in which the shares are disposed of