Taxation of Chargeable Gains Act 1992 section 232

Chargeable event when replacement assets owned

Section 232 sets out what happens when a chargeable event occurs in relation to trustees who hold replacement assets that benefited from roll-over relief under section 229, triggering a deemed disposal to recapture the deferred gain.

• When a chargeable event occurs in relation to trustees and the claimant (or a connected person) still owns all the replacement assets, there is a deemed disposal and immediate reacquisition of those assets at a value that crystallises the previously deferred gain.
• The deemed disposal produces a chargeable gain equal to the amount by which the original disposal consideration was reduced under section 229 roll-over relief — effectively clawing back the gain that was rolled over into the replacement assets.
• If the claimant or connected person holds only some of the replacement assets at the time of the chargeable event, the deemed disposal still applies but is limited to those assets, and the resulting gain is reduced to a just and reasonable amount.
• If part of the rolled-over gain has already been brought into charge before the chargeable event (for example, through an earlier disposal of some replacement assets), the gain on the deemed disposal is reduced on a just and reasonable basis, potentially to nil if that is appropriate.