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HMRC internal manual

Capital Gains Manual

HM Revenue & Customs
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Share reorganisations: apportionment of cost: main rule


The main rule in TCGA92/S129 is that you apportion the acquisition cost attributable to each class of share included in the new holding at the date of disposal of any of these shares, using the formula

base cost x market value part disposed of
  market value part disposed of + market value part retained

This compares with the ordinary part disposal formula in TCGA92/S42 which is

base cost x consideration received
  consideration received + market value part retained