Taxation of Chargeable Gains Act 1992 section 103D

Co-ownership schemes

Section 103D sets out how capital gains tax applies to participants in authorised contractual schemes that are structured as co-ownership schemes, ensuring that units in such schemes are treated as the taxable asset rather than the underlying property held by the scheme.

• A participant's direct interests in the underlying property of a co-ownership scheme are disregarded for capital gains tax purposes — the taxable asset is the unit itself, not the property behind it
• When computing the gain on disposal of units, the scheme is treated as though it were a unit trust scheme, with the participant treated as a unit holder, applying the same accumulation unit rules under section 99B
• An exception applies where a participant is entitled to structures and buildings allowances on fund property — in that case, the participant's interest in the property is not disregarded when applying the section 37B adjustment on disposal of units
• The section only applies to authorised contractual co-ownership schemes that are not relevant offshore funds, with key terms defined by reference to the Financial Services and Markets Act 2000