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HMRC internal manual

Capital Gains Manual

Securities: debts: CG treatment of debts: security: QCBs

The debt on a security is a chargeable asset. TCGA92/S251 (1) refers to `the debt on a security’. Section 251(2) refers to `a debt on a security’. The distinction is not important. In Aberdeen Construction Group Ltd v CIR 52TC281 Lord Russell said `I do not know why `the debt’. I take the phrase simply to mean `a debt’ the language used in [sub para] (2).’ Advice on how to establish whether a debt is the debt on a security is at CG53420+.

In addition, some debts are specifically treated as securities for capital gains purposes. See CG53440+.

Many debts on a security will be qualifying corporate bonds (QCBs). QCBs are themselves exempt from Capital Gains Tax, though gains or losses from earlier events can crystalise on the disposal of a QCB. Detailed advice on QCBs is at CG53700+.