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HMRC internal manual

Capital Gains Manual

Charities: Reverter of Sites Act 1987

If the persons with the right of reverter are immediately identified, then the deemed disposal under Section 256(2) is followed immediately by another deemed disposal by the trustees under TCGA92/S71 (1). This would not give rise to any gain, because the value of the property would be the same. Thereafter the trustees would hold the property as bare trustees within TCGA92/S60. A conveyance of the property to the person with the right of reversion would be ignored, and a sale by the trustees would be treated as a sale by the person with the right of reversion. See CG34360.

If, however, some or all of the persons with the right of reverter have not been identified, the property continues to be settled property until all the relevant persons have been identified. If the property is sold before then, the disposal is by the trustees and the trustees are chargeable on the gain at 18% for 2008-09 onwards, at the RAT (rate applicable to trusts) for 1999-2000 to 2007-08 and at the basic rate for years up to and including 1998-99. Assessments should be made in the appropriate Specialist PT Trusts office. If the relevant persons are identified before the property is sold, there is a deemed disposal under TCGA92/S71 (1) at that point.