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HMRC internal manual

Capital Gains Manual

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HM Revenue & Customs
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Deferred consideration: unascertainable: election for treatment of loss - Condition 1 - chargeable gain postponed

TCGA92/S279A

There is an additional rule where a chargeable gain which satisfies Condition 1, see CG15085, is postponed on account of an investment being made by the taxpayer in shares in VCTs or in qualifying companies under the EIS.

If a “chargeable event” occurs in relation to any of these shares, for example some or all of the shares are disposed of, then a chargeable gain, a “revived gain”, accrues to the taxpayer. Such revived gains are within Condition 1 unless they are themselves postponed on account of further investments being made by the taxpayer in shares in VCTs or in EIS companies. If this happens, and a chargeable event occurs in relation to those shares, then gains which are the “revived gains” on that occasion can fall into this category unless they are themselves postponed in this way. This process continues for any number of successive reinvestments.