Taxation of Chargeable Gains Act 1992 Schedule 5AAA paragraph 24

Relief for expenses in the case of deemed disposals under paragraph 21 or 22

Paragraph 24 of Schedule 5AAA provides relief for incidental disposal costs where a deemed disposal arises under the UK property-rich collective investment vehicle rules.

• This paragraph applies where a person is treated as having made a disposal under paragraph 21 (deemed disposal when payments are received that derive value from UK land) or paragraph 22 (deemed disposal when an exemption election ceases to have effect).
• The person is treated as having incurred allowable incidental costs of making the deemed disposal, even though no actual sale took place.
• These allowable costs are equal to the "notional costs" — the incidental costs the person would reasonably have expected to incur if the deemed sale had been a real transaction.
• Only costs that would have qualified as allowable incidental disposal costs under section 38(1)(c) in the case of an actual sale can be claimed as notional costs.