Taxation of Chargeable Gains Act 1992 section 119C

Section 119A: unremitted Part 7A income

Section 119C restricts the uplift to the cost base of employment-related securities under section 119A where some or all of the related employment income arising under the disguised remuneration rules (Part 7A of ITEPA 2003) has not yet been remitted to the United Kingdom.

• Where employment income taxed under the disguised remuneration rules (Part 7A of ITEPA 2003) has been deducted from a later charge on securities, section 119A would normally add that deducted amount back into the cost of acquiring the securities for capital gains purposes — but this add-back is blocked to the extent the Part 7A income has not been remitted to the UK.
• Only Part 7A income that has actually been remitted to the UK by the end of the tax year in which the securities are disposed of qualifies to be added back to the acquisition cost at that point.
• If the unremitted Part 7A income is remitted to the UK in a later tax year, the taxpayer may make a claim to have the gain or loss on the disposal recomputed as though the income had been remitted before the end of the year of disposal, with any necessary adjustments made by assessment regardless of normal time limits.
• Unremitted Part 7A income is defined as employment income arising under Chapter 2 of Part 7A of ITEPA 2003 that is subject to the remittance basis (under sections 554Z9(2) or 554Z10(2) of that Act) and has not been remitted to the UK by the end of the relevant tax year.