Indexation: from 6/4/88: general principles
- The allowance is available in respect of gains accruing to all taxpayers, including companies, trustees and personal representatives.
- No claim by the taxpayer is required. Where an indexation allowance may be due but has not been included in a computation of a chargeable gain, the District should draw the attention of the taxpayer to the position, preparing a revised computation, where appropriate.
- In order to compute the allowance it is necessary to establish the date on which the expenditure was incurred, see CG17251.
- The indexation allowance is calculated by reference to the `RELEVANT ALLOWABLE EXPENDITURE’ (RAE), see CG17240.
- The costs of acquisition and each item of enhancement expenditure are indexed separately.
- Shares and other assets which form part of a pool, see CG11800+, are subject to a number of special provisions. They are therefore dealt with in a separate section of the guidance. See CG50500+.
- For disposals made between 6 April 1998 and 5 April 2008, except for disposals made by companies within the charge to Corporation Tax, indexation allowance is calculated to April 1998 and not to the month of disposal.