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HMRC internal manual

Capital Gains Manual

Capital payment to non-resident close company not controlled by UK resident persons


If the company is not controlled by UK resident persons so that TCGA92/S96(2) to (6) does not apply the capital payment is disregarded, TCGA92/S87C. This means there is no matching and the section 2(2) amounts are not reduced. This rule applies only to capital payments received on or after 6 April 2008. If the payment is received before that date it will reduce the trustees’ gain without a charge to Capital Gains Tax when the payment is matched.