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HMRC internal manual

Capital Gains Manual

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HM Revenue & Customs
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Transfer of assets: between husband and wife or between civil partners living together: year of separation

TCGA92/S58 applies to a disposal in any year of assessment if a husband and wife or civil partners are living together in that year of assessment. There is no requirement that they should be living together throughout that year. If the couple are living together at some time in a year of assessment assets can be transferred between them at any time in that year of assessment at no gain/no loss.

An asset can be transferred between them at no gain/no loss even when they have permanently separated provided that they have been living together at some time in that year of assessment. Where a husband and wife or civil partners separate during a year of assessment transfers at no gain/no loss can be made between them for the remainder of that year.

The actual consideration given on a transfer within CG22000+ is ignored. So it does not matter if the asset is gifted or sold by one spouse to the other or by one civil partner to the other. This is illustrated by the example at CG22240.

The date of acquisition of the transferee is the date of disposal of the transferor. Similarly, the cost of acquisition is the deemed consideration on the disposal by the transferor, see CG17400+.

But if the transferor held the asset at 31 March 1982 and the transferee disposes of that asset on or after 6 April 1988, the transferee is deemed, for rebasing purposes, to have held the asset at 31 March 1982. See CG16880+.

If an asset which has been transferred at no gain/no loss is subsequently disposed of, special rules apply to restrict the extent to which indexation allowance can create or increase a loss, see CG17730+.

NOTE. If a taxpayer is within the charge to Capital Gains Tax, neither indexation allowance nor taper relief apply to disposals of assets on or after 6 April 2008. Previously indexation allowance had been frozen at April 1998. For indexation allowance see CG17207+ and for taper relief see CG17895+.