Taxation of Chargeable Gains Act 1992 section 234

Chargeable events when bonds owned

Section 234 dealt with the tax treatment when replacement assets acquired under compulsory purchase roll-over relief were shares that were subsequently converted into qualifying corporate bonds, and a chargeable event later occurred.

• Where roll-over relief under section 229 was claimed and the replacement assets were shares that were later exchanged for qualifying corporate bonds, a chargeable gain could be triggered when a chargeable event occurred in relation to the original compulsory purchase.
• The gain deemed to arise was the lower of two amounts: the gain that would crystallise on a notional disposal of the bonds at that time under section 116(10)(b), and the amount of the original gain that had been rolled over under section 229.
• Where only some of the replacement shares were converted into bonds, or only some of the bonds were still held, the rules still applied but with just and reasonable adjustments to reduce the amounts accordingly.
• This section was effectively repealed because the underlying compulsory purchase roll-over relief was withdrawn for disposals occurring on or after 6 April 2001.