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HMRC internal manual

Capital Gains Manual

HM Revenue & Customs
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Share identification for corporation tax: relevant securities: indexation allowance

The ordinary indexation allowance rules of TCGA92/S53 to 57 apply to relevant securities. Indexation allowance is not due if the disposal occurs within a period of 10 days starting on the date of acquisition, TCGA92/S54(2).

The special rules dealing with disposals for delivery on a particular date and carry over transactions can result in a disposal being matched with a later acquisition.

The operation of the RD – RI formula in TCGA92/S54 is purely mechanical


If the RPI has fallen, indexation allowance can be given. Therefore, a disposal in October 1990, when the RPI was 130.3, matched against an acquisition in December 1990, when RPI was 129.9, would attract indexation allowance.