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HMRC internal manual

Capital Gains Manual

Capital payments - valuation of benefits and non-cash payments


Unless the capital payment is a payment of money it will have to be valued. Section 97(4) provides the amount of a capital payment by way of loan or anything other than the outright payment of money is equal to the value of the benefit conferred.

If the payment is the transfer of trust property the value will be the market value of the asset. If the payment is the conferring of a benefit the value will be the value of a similar benefit received from an unconnected third party.

The most common benefits giving rise to capital payments are:

  • interest free or low interest loans, CG38645
  • rent free or low rent occupation of property,CG38660.