Taxation of Chargeable Gains Act 1992 section 103KB

Carried interest: consideration on disposal etc. of right

Section 103KB deals with how amounts received by an individual for disposing of, varying, losing or cancelling a right to carried interest are treated for capital gains tax purposes.

• Any consideration received for the disposal, variation, loss or cancellation of a right to carried interest is treated as carried interest arising to the individual at the time of that event
• This treatment does not apply where the consideration already falls to be taxed as a disguised investment management fee under the income tax rules
• Where the disposal is not at arm's length, the transferor is treated as receiving an amount equal to the market value of the carried interest right
• For market value purposes, any restrictions that would reduce the value of the right to carried interest are disregarded