Taxation of Chargeable Gains Act 1992 section 169V

Operation of deferred business asset disposal relief

Section 169V sets out how business asset disposal relief (formerly entrepreneurs' relief) operates when a previously deferred gain becomes chargeable, ensuring the gain qualifies for the lower capital gains tax rate without being taxed twice.

• When a deferred gain crystallises, it is automatically treated as qualifying for business asset disposal relief based on the original claim, subject to the lifetime limit on relief.
• If the deferred gain comes back into charge in stages rather than all at once, each subsequent portion also qualifies for business asset disposal relief without the need for a fresh claim.
• To prevent double taxation, gains that receive business asset disposal relief under these rules are not also treated as chargeable gains for other purposes of the Act.
• Where the original disposal was an associated disposal linked to a relevant material disposal, special rules ensure the correct restrictions on relief are applied by reference to the original disposal rather than the deemed disposal when the gain crystallises.