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HMRC internal manual

Capital Gains Manual

HM Revenue & Customs
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Assets: valuation: transfer to employer at overvalue

The transfer of an asset from an employer to an employee at undervalue results in a net transfer of value to the employee. The same result can be achieved by the transfer of an asset from the employee to the employer at overvalue. Such a transfer may also give rise to a charge under employment income, see EIM08008.

Any part of the consideration received by the employee which is taken into account in computing their income is excluded from the consideration in their Capital Gains Tax computation (TCGA92/S37, see CG14303). In many cases this will mean that the consideration taken into account is restricted to the market value of the asset transferred.