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HMRC internal manual

# Assets held on 6/4/65: part-disposals after 5/4/65: example

### TCGA92/SCH2/PARA16 (8)

 £ On 6 April 1960 X acquires a chargeable asset for 20000 On 6 April 1970 X disposes of an interest in it for 6000 The market value of the remainder is estimated at 24000 The market value at 31 March 1982 is 30000 On 6 April 1990 X disposes of the remainder for 100000

Assume that all these amounts are net of expenses.

### PART-DISPOSAL ON 6 APRIL 1970

 £ Disposal proceeds 6000 Less 6000 Apportioned cost 6,000 + 24,000 x £20,000 = 4000 Gain 2000 5 Chargeable gain 10 x £2,000 = 1000

### FINAL DISPOSAL ON 6 APRIL 1990Allowable expenditure on part retained after part-disposal

 £20,000 - £4,000 = £16,000

### Computation of entire gain on old basis over period of ownership

 £ Disposal proceeds 100000 Less Balance of cost 16000 Unindexed gain 84000 Less Indexation 30,000 x 0.575 17250 Gain 66750

Computation of gain from 6 April 1960 to 6 April 1970

 Market value at date of part-disposal 24000 Less Cost 16000 Gain 8000

Proportion of gain 6 April 1965 to 6 April 1970

 5 10 x £8,000 = £4,000

Balance of gain from 6 April 1970 to 6 April 1990

 = entire gain - gain over period to part-disposal = £66,750 - £8,000 = £58,750.

### The chargeable gain on the old basis

 = proportion of gain 6 April 1965 to 6 April 1970 + balance of gain from 6 April 1970 to 6 April 1990 = £4,000 + £58,750 = £62,750.

The final step in the computation would be to make the comparison with the rebased gain, see CG16730+.