Taxation of Chargeable Gains Act 1992 section 129

Part disposal of new holding

Section 129 deals with how to split the original cost of shares between the part sold and the part kept when only part of a new holding (received following a share reorganisation) is disposed of.

• When only part of a new holding is sold, the original acquisition cost must be divided between the shares disposed of and those retained.
• The apportionment is based on market values at the date of the part disposal, not at the date of the reorganisation.
• An adjustment is made to the market value of any part of the new holding where a liability attaches to it that forms part of the cost being apportioned.
• This general rule does not apply where the new holding includes more than one class of share or debenture and any of them are quoted — in that case, the apportionment is instead made by reference to values at the date of the reorganisation, as provided by section 130(2).