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HMRC internal manual

Capital Gains Manual

Roll-over relief: assets not brought immediately into trade use: ESC D24


ESC D24 states that qualifying assets may be treated as if they were taken into use on the acquisition where:-

  • capital expenditure is incurred on enhancing the value of the asset;


  • the improvement works begin as soon as practicable after acquisition and are completed within a reasonable period;


  • the asset is taken into use (and in the case of land or buildings, occupied) only for the purposes of the trade as soon as is practically possible after completion of the work;


  • the asset is neither let nor used for any non-trading purpose in the period between acquisition and taking into use for trade purposes.

This interpretation of the statutory wording “which on the acquisition are taken into use” in TCGA92/152(1) was given judicial approval by Sir Richard Scott in Steibelt v Paling [1999] STC 594 when he commented “I regard D24 as being a very sensible attempt by the Revenue to indicate how it believes the language of the 1992 Act in this regard should be applied.”

Accordingly, we will continue to draw on the interpretation as set out in ESC D24 where appropriate, whilst acknowledging Sir Richard’s Scott’s conclusion that ESC D24 is not strictly a concession.