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HMRC internal manual

Capital Gains Manual

Deferred consideration: unascertainable: election for treatment of loss - further specified conditions - Condition 1


Condition 1, see CG15083 above, is met, in circumstances where there is just one original disposal, see CG15084, paragraph (a), if a chargeable gain accrued to the taxpayer

  • on that disposal, or
  • on an earlier disposal of the original asset in the year of the original disposal, or
  • on a subsequent disposal of the original asset before the year of the right’s disposal.

Condition 1 is also met if any chargeable gain which would have accrued on any such disposal is postponed on account of its being reinvested in a qualifying investment under the Enterprise Investment Scheme (EIS) or in a Venture Capital Trust (VCT), see CG15087.

For general guidance on the Enterprise Investment Scheme (EIS) see VCM35000+, and on Venture Capital Trusts (VCT), see VCM68000+.

Condition 1 is also met in circumstances where there are two or more original disposals, including cases where the disposals are of different assets. Where there is more than one original asset, Condition 1 is met if it is satisfied in respect of any one of those assets.


A farmer sells two pieces of land for total consideration which includes a right to deferred unascertainable consideration. A chargeable gain accrues on the disposal of one piece of land but a loss accrues on the other disposal. However, Condition 1 is satisfied, because all the requirements are met in relation to the disposal of the land on which the chargeable gain accrues.