Income Tax Act 2007 section 517D

Disposals of property deriving its value from land in the United Kingdom

Section 517D sets out the conditions under which profits or gains from disposing of property that derives its value from UK land may be treated as taxable trading profits.

• The section applies where a person makes a profit or gain from disposing of property that, at the time of disposal, derives at least 50% of its value from land in the United Kingdom.
• The person must be a party to, or concerned in, an arrangement relating to some or all of that land (known as "the project land").
• The arrangement must have as its main purpose, or one of its main purposes, dealing in or developing the project land and realising a profit from disposing of property deriving value from it.
• Where all these conditions are met, the profit or gain falls within the scope of section 517E, which can treat it as a trading profit subject to income tax.