Taxation of Chargeable Gains Act 1992 section 76A

Disposal of interest in settled property: deemed disposal of underlying assets

Section 76A introduces Schedule 4A, which applies when someone sells or otherwise disposes of an interest in settled property (i.e. property held in a trust) for consideration, triggering a deemed disposal of the underlying trust assets for capital gains tax purposes.

• This section activates Schedule 4A of the Taxation of Chargeable Gains Act 1992, which deals with disposals of interests in settled property.
• The rules apply only where an interest in settled property is disposed of for consideration — that is, where something of value is received in return, rather than a gift.
• The effect of Schedule 4A is to treat the trustees as having made a deemed disposal and reacquisition of the underlying trust assets, potentially giving rise to chargeable gains.
• These provisions have had effect from 20 March 2000, having been introduced by section 91(1) of the Finance Act 2000.