Taxation of Chargeable Gains Act 1992 section 228

Conditions for relief: supplementary

Section 228 provides supplementary definitions and conditions that support the roll-over relief for disposals to employee share ownership trusts (ESOTs) under section 227, though this relief was withdrawn for disposals on or after 6 April 2001 when ESOTs were replaced by share incentive plans.

• The section defines three key time periods: the entitlement period (12 months from disposal), the acquisition period (6 months from disposal or from when the third condition in section 227 is met, whichever is later), and the proscribed period (from disposal to acquisition or to when the third condition is met, whichever is later).
• Arrangements are treated as unauthorised unless they arise solely from a permitted restriction or only allow share acquisition by a settlement beneficiary or appropriation under an approved profit sharing scheme.
• An asset is a chargeable asset if a gain on its disposal would be subject to capital gains tax or corporation tax, unless double taxation relief arrangements mean the claimant would not be liable to UK tax on the gain.
• The section defines key terms including ordinary share capital, holding company, trading company, and trading group, and requires trustees to be treated as a company for the purposes of the equity holder rules in CTA 2010.