CG22220 - Transfer of assets: between spouses or between civil partners: living together: other points
Part Disposals
Assets at 6/4/65
Series of transactions
More than one transfer
Part Disposals
TCGA92/S58 applies to part disposals of assets between spouses or between civil partners in the same way as to any other transfer. The method of computing the deemed consideration on a part disposal is illustrated by CG22240.
You will usually need two valuations. A valuation of the
- part disposed of at the date of transfer
and of the
- part retained at the same date.
You may also need a valuation of the whole asset at 31 March 1982, see CG12735.
In some cases the practice explained at CG12730 can be applied and the valuations will not be needed.
Assets at 6/4/65
TCGA92/SCH2/PARA22
Where an asset which has been transferred between spouses or between civil partners was owned by either at 6 April 1965, you should treat the original acquisition of the asset by the one spouse or civil partner and the final disposal of it by the other as made by one person. So the provisions of TCGA92/SCH2/PARA22 will apply.
This means that the chargeable gain accruing on the ultimate disposal will be restricted to take account of the period of ownership before 6 April 1965, see CG15500+.
The application of this paragraph may still be relevant for a disposal which takes place on or after 6 April 1988 if no election has been made under TCGA92/S35 (5) for rebasing to 31 March 1982. In these circumstances the `kink test’ will need to be applied, see CG16730+.
Series of transactions
TCGA92/S19
TCGA92/S19 contains special rules to determine the consideration on the disposal of an asset between connected persons when
- that disposal is part of a series of such transactions and
- the assets together are worth more than they are separately.
How to recognise and deal with such a series of transactions is explained at CG14650+.
TCGA92/S19 (2) makes it clear that TCGA92/S58 takes priority over Section 19. So a transfer between spouses or between civil partners within Section 58 will give rise to neither a gain nor a loss even if it is part of a series of transactions between connected persons, see CG14710.
But you should still take account of a disposal between spouses or between civil partners in deciding
- whether there has been a series of transactions
and
- what the deemed consideration should be on the other transactions in the series.
More than one transfer
TCGA92/S58 can apply through several transfers between spouses or between civil partners even if the asset is eventually transferred to a spouse or to a civil partner who was not one of the original married couple or not one of the civil partners within the original civil partnership and has never been married to or a civil partner of either of them. This is because you only need to consider the circumstances at the date of each transfer.
For example, B is married to and living with C. He transfers an asset to her and Section 58 applies. They divorce and C marries and lives with D. She transfers the asset on to him and Section 58 again applies.
They divorce and D enters into a civil partnership with and lives with E. He transfers the asset on to him and once again Section 58 applies. E sells it and his gain is computed on the basis that the cost of the asset is the deemed consideration paid to D on transfer.