Taxation of Chargeable Gains Act 1992 section 108

Identification of relevant securities for corporation tax

Section 108 sets out the rules for identifying which specific securities are treated as being disposed of when a company sells relevant securities, for the purposes of calculating corporation tax on chargeable gains.

• Relevant securities include securities within the accrued income scheme, qualifying corporate bonds, and interests in non-reporting offshore funds — acquisitions of these are not pooled but instead individually matched to disposals
• Disposals are matched first against acquisitions made in the previous 12 months on a first in, first out basis, and then against earlier acquisitions on a last in, first out basis
• Where a company uses arrangements to postpone delivery of securities, a single bargain to acquire and dispose is matched together, and any earlier disposals displaced by this matching are re-identified against other available acquisitions
• The section does not apply to quoted securities unless a specific election has been made under Schedule 2 paragraph 4 or section 109(4), nor where Schedule 2 paragraphs 17 or 18 apply