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HMRC internal manual

Capital Gains Manual

Roll-over relief on transfer of shares to Share Incentive Plan: allowing full relief

If the replacement asset is acquired for the full amount of the disposal consideration,then:

  • you reduce the consideration for the disposal to a figure that gives a no gain/no loss result


  • you reduce the acquisition cost of the replacement asset by the same amount.

The whole of the capital gain is rolled over into the acquisition cost of thereplacement asset.


Mr A acquired shares in AA Ltd for £5,000 before April 1998.

In July 2001, he sells them to the trustees of the AA Ltd approved Share Incentive Planfor their market value £15,000 making a gain after indexation allowance of £9,000. InAugust 2001, he acquires shares in XYZ Ltd for £17,500 and claims relief underTCGA92/SCH7C.

The computations are:

(a) No gain/no loss on disposal on AA Ltd shares  
  Actual consideration 15,000
  No gain/no loss consideration 6,000
  Reduction 9,000
(b) Reduced costs of XYZ Ltd shares:  
  Actual cost 17,500
  Reduction 9,000
  Cost to carry forward 8,500