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HMRC internal manual

Capital Gains Manual

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HM Revenue & Customs
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Assets held on 6/4/65: land with development value

TCGA92/SCH2/PARA9The value of land may increase substantially and suddenly when it acquires a development value, for example, following some decision by a planning authority. In these circumstances, the straight-line apportionment method (for the determination of the gain accruing after 6 April 1965 of land acquired before that date) is not appropriate. On a disposal, including a part- disposal, land situated in the United Kingdom with development value is deemed, for the purpose of computing chargeable gains, to have been acquired on 6 April 1965 at its then market value. This treatment applies

  • whether or not planning permission for development had been granted prior to disposal (see Watkins v Kidson 53TC117);
  • equally to all estates or interests in land - for example, to leases as well as to freeholds.Detailed instructions on this topic can be found at CG72600+.