Taxation of Chargeable Gains Act 1992 Schedule 4ZZC paragraph 6

Interest subsisting under contract for off-plan purchase

Paragraph 6 of Schedule 4ZZC deals with how to determine the acquisition date of a property interest when the property is purchased "off-plan" — that is, where a contract is entered into before the property has been constructed or completed.

• When a person enters into a contract to purchase a property that has not yet been built or completed (an off-plan purchase), the interest in the property is treated as acquired at a specific point for capital gains purposes.
• The acquisition date is not the date the contract is signed, but rather the date on which the construction or conversion of the property is substantially completed — meaning the date the purchaser can realistically take possession or use of the property.
• This rule ensures that the period of ownership for capital gains purposes begins from substantial completion rather than from the earlier contract date, which can affect the calculation of any gain or loss on a subsequent disposal.
• The provision was introduced by the Finance Act 2019 and applies in the context of disposals of UK land interests, aligning the treatment of off-plan purchases with the broader rules on non-resident capital gains.

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