Taxation of Chargeable Gains Act 1992 section 281

Payment by instalments of tax on gifts

Section 281 allows a person who incurs a capital gains tax liability on certain gifts or deemed disposals to elect to pay that tax in ten equal yearly instalments, subject to conditions regarding the type of asset, the availability of hold-over relief, and the subsequent treatment of the gifted assets.

• Where qualifying assets are gifted (or deemed disposed of by trustees) and hold-over relief does not fully eliminate the gain, the taxpayer may elect to pay the resulting CGT in 10 equal yearly instalments.
• Qualifying assets are limited to land (or interests in land), shares or securities giving control of a company, and shares or securities in unlisted companies.
• Interest runs from the normal due date on the outstanding balance and is added to each instalment, though the taxpayer may pay off all remaining tax and interest at any time.
• If the gifted assets were transferred to a connected person (or arose from a deemed trust disposal) and those assets are subsequently sold for valuable consideration, all outstanding tax and interest become payable immediately.