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HMRC internal manual

Capital Gains Manual

Indexation: disposals 4/85 to 3/88: no gain/loss

FA85/S68 (7) & (8)

Provision was made for persons disposing of assets, other than on a no gain/no loss disposal, to make a claim under FA85/S68(5) even though they did not hold the assets on 31 March 1982 where they, as transferee, had acquired the assets from a transferor who was at the time of this transaction-

  • his (or her) spouse, TCGA92/S58 applying, see CG22200+; or
  • a company, TCGA92/S139 or TCGA92/S171 applying, see CG45300+ and CG45630;
  • where the asset is land, a predecessor constituency association, TCGA92/S264 applying, see CG61800+; or
  • the Hops Marketing Board, FA82/S148 applying (now repealed 2004);

and either the transferor had held the asset on 31 March 1982, or had acquired it since then on a no gain/no loss transfer of the kind specified above, or in a succession of such transfers from a person who had so held it. In these circumstances the transferee may make a claim for the indexation allowance to be calculated by reference to the market value of the asset at 31 March 1982. However, since under the no gain/no loss provisions in TCGA92/S56 (2), see CG17402, the transferee is treated as having acquired the asset for a consideration which together with any indexation allowance produces neither a gain nor a loss, it is necessary, in arriving at the unindexed gain or loss, to deduct the indexation allowance already included in the consideration which is treated as given for the asset.