When does Part 4 of Schedule 4AA TCGA 1992 apply to a direct disposal of UK land?

Part 4 of Schedule 4AA applies to direct disposals of UK land where neither Part 2 nor Part 3 of the Schedule applies. Additionally, the disposal must not involve a post-April 2015 asset that was fully residential throughout the entire period from acquisition to 5 April 2019. It acts as a residual category for disposals not covered elsewhere.

What is a post-April 2015 asset for the purposes of Schedule 4AA paragraph 12?

A post-April 2015 asset is one that a person acquired after 5 April 2015. This classification is relevant because Part 4 does not apply to a post-April 2015 asset that was also fully residential before 6 April 2019. Such disposals instead fall under Part 2 or Part 3 of Schedule 4AA.

What does fully residential before 6 April 2019 mean under Schedule 4AA?

An asset is fully residential before 6 April 2019 only if the land consisted of a dwelling on every single day from the date of acquisition to 5 April 2019. If there was even one day during that period when the land was not a dwelling, the asset was not fully residential and Part 4 may apply.

How does Schedule 4AA paragraph 12 treat off-plan or construction contract purchases?

Where a disposal involves an interest in land held under a contract and at any point during the relevant period the land did not consist of a building to be constructed or adapted for use as a dwelling, the disposal is treated as not fully residential before 6 April 2019. This means Part 4 will apply, covering off-plan purchases where no residential building existed throughout.

Taxation of Chargeable Gains Act 1992 section Sch 4AA para 12

Introduction

Section Sch 4AA paragraph 12 sets out when Part 4 of the Schedule applies to a direct disposal of UK land, specifically covering disposals that are partly chargeable before 6 April 2019 and do not fall under Part 2 or Part 3 of the Schedule.

Part 4 applies to direct disposals of UK land where neither Part 2 nor Part 3 of the Schedule applies to the disposal
The disposal must not involve a post-April 2015 asset (acquired after 5 April 2015) that was fully residential throughout the period from acquisition to 5 April 2019
An asset is considered fully residential before 6 April 2019 only if the land consisted of a dwelling on every single day from acquisition to 5 April 2019
Where the disposal relates to an interest under a contract for land that at any time in the relevant period did not consist of a building to be constructed or adapted for use as a dwelling, it is treated as not fully residential before 6 April 2019

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