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HMRC internal manual

Business Income Manual

Definitions: Apportionment

The legislation requires apportionments to be made in various situations. Where an apportionment is required Section 356OE and 356OJ CTA 2010 and Section 517E and 517JITA 2007 explain it should be made on a just and reasonable basis.

This just and reasonable method must:

  • Take into account the value of what is obtained for disposing of the land, and
  • Allow only such expenses as are properly attributable to the land which is subject to the disposal.

This covers apportionments of overheads, expenditure, consideration and any other amount which needs to be considered for the purposes of this legislation.

There may also be a need for apportionment when a company deals in UK land, partly for investment purposes, and partly as a trade.