Taxation of Chargeable Gains Act 1992 Schedule 4ZZC paragraph 20

Interest subsisting under contract for off-plan purchase

Paragraph 20 of Schedule 4ZZC addresses how to determine the date from which an interest in a property is treated as held when the property is purchased off-plan — that is, before construction is completed.

• When a person enters into a contract to purchase a property that has not yet been built or completed (an off-plan purchase), they may acquire a beneficial interest in the property before legal completion takes place.
• For the purposes of calculating whether a gain qualifies for any relevant relief or exemption under this Schedule, the interest is treated as held from the date the contract is entered into, not from the date of legal completion or physical completion of the property.
• This rule ensures that the period of ownership for chargeable gains purposes reflects the commercial reality that the purchaser has committed to the acquisition and holds a beneficial interest from the contract date.
• The provision was introduced by the Finance Act 2019 and applies specifically within the framework of Schedule 4ZZC to the Taxation of Chargeable Gains Act 1992.

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