Rebasing applies to disposals on or after 6 April 1988 of assets held on 31 March 1982. The general rule is that the gain or loss is computed by reference to 31 March 1982 market value. This is subject to a `kink test’ which compares the rebased gain or loss with the result by reference to historic cost. If each method produces a gain, the smaller gain is the chargeable gain. Similarly with losses. But taxpayers can elect out of the kink test, in which case they compute the gains and losses on the disposal of their assets solely by reference to 31 March 1982 market value.