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HMRC internal manual

Capital Gains Manual

Expenditure: incidental costs of acquisition and disposal

TCGA92/S38 defines the incidental costs of acquisition and disposal. The definition is exhaustive. NO OTHER EXPENDITURE IS ALLOWABLE.

If a disposal by a company (Company A) is deemed to have been made by another company (Company B) following an election under TCGA92/S171A (CG45355), incidental costs of disposal incurred by Company A which would have been allowable if the gain had been chargeable on Company A can be allowed in the computation of the gain chargeable on Company B.

Allowable incidental costs are limited to

  • fees, commission or remuneration paid for the professional services of any

    • surveyor, valuer or auctioneer
    • accountant or agent
    • legal adviser
  • costs of transfer or conveyance (including Stamp Duty or stamp duty land tax)
  • costs of advertising to find a buyer or seller
  • costs reasonably incurred in making any valuation or apportionment required for the purposes of the Capital Gains Tax computation.

The expenditure must have been incurred WHOLLY AND EXCLUSIVELY for the purposes of the acquisition or disposal.