CG13137 - Introduction and computation: occasions of charge: assets lost/destroyed/negligible value: buildings and structures
Throughout this manual, all legislative references are to the Taxation of Chargeable Gains Act
1992 (TCGA 1992) unless otherwise stated.
Where there are buildings or structures on land, under general law, the asset is actually the underlying land itself. As this land can never be entirely destroyed and is unlikely to become of negligible value, the building or structure would be outside section 24(1) or section 24(2).
To overcome this, section 24(3) allows the owner to treat a building or structure as an asset which is separate and distinct from the underlying land on which it stands, thus allowing claims under either section 24(1) or section 24(2). Section 24(3) does not apply automatically. Instead, it is necessary for the owner to tell HMRC, in writing, that they want section 24(3) to apply.
When there is a deemed disposal of a building or structure under either section 24(1) or section 24(2), the claimant is also treated as though they disposed of and immediately reacquired the site, see CG15773, of the building or structure. Under section 272, this deemed disposal and reacquisition are treated as taking place at the market value of the site at the date of the section 24(1) or section 24(2) deemed disposal.