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HMRC internal manual

Capital Gains Manual

Arrival in and departure from the UK: establishing the correct time when a gain arises: binding contract pre-dating emigration

Legislation enacted with effect from 27 September 1989 requires all disposals of interests in land in England and Wales to be evidenced in writing if there is to be a valid contract, see CG70280 and CG14263. (This has always been the requirement for land in Scotland.) For disposals after that date an oral contract will not be a valid contract. This means that in cases where the written contract is delayed until after 5 April following departure from the UK you will not be able to establish the existence of a binding agreement preceding the date of sale (see CG25860).

In such circumstances it is still possible for there to be a gain chargeable to tax if any of the following apply:

  • TCGA92/S10 (non-resident with United Kingdom branch or agency, see CG25500+)
  • TCGA92/S10A (temporary non-residents, see CG26100+)
  • TCGA92/S25 (non-residents: deemed disposals, see CG25530).

You should note that the above applies only when the land is situated in England or Wales or Scotland. It does not apply if the land is situated in Northern Ireland or any other country where the legislation does not require the contract to be in writing in order for it to be valid.