Income Tax Act 2007 section 257TA

Identification of investments on a disposal

Section 257TA sets out the rules for determining which investments in a social enterprise are treated as disposed of when an investor sells only part of their holding.

• Investments acquired on an earlier date are always treated as disposed of before those acquired on a later date (a "first in, first out" approach).
• Where investments were made on the same day, those without any tax relief attached are treated as disposed of first, followed by those with hold-over relief only, then those with SI relief only, and finally those with both reliefs.
• Investments transferred between spouses or civil partners are treated as acquired on the date they were originally made, not the date of the transfer.
• Where a share reorganisation has taken place, shares in the new holding are treated as acquired on the date the original shares were acquired.