Taxation of Chargeable Gains Act 1992 Schedule 4ZZB paragraph 21

Interest subsisting under contract for off-plan purchase

Paragraph 21 of Schedule 4ZZB deals with how to determine the period of ownership when a person holds an interest in a property under a contract for an off-plan purchase — that is, a contract to buy a dwelling that has not yet been built or is still under construction.

• When a person enters into a contract to purchase a property off-plan (before it is built or completed), they acquire an interest in the property from the date the contract is entered into.
• The period of ownership for the purposes of calculating any chargeable gain begins from the date of the off-plan contract, not from the date the property is completed or the purchase is formally finalised.
• This provision ensures that the time spent waiting for an off-plan property to be built counts towards the overall ownership period, which can affect the computation of any gain on disposal.
• The rule was introduced by the Finance Act 2019 and applies within the broader framework of Schedule 4ZZB, which governs the calculation of gains on residential property disposals by non-residents and in other specific circumstances.