This part of GOV.UK is being rebuilt – find out what beta means

HMRC internal manual

Capital Gains Manual

Reliefs: employee-ownership trusts: the new rules

TCGA92/S236H(2)-(3) and S236Q(2)-(3)

Where a disposal qualifies for relief, this is given by the relevant disposal and acquisition being treated for the purposes of TCGA92 as being made for consideration that gives rise to neither a gain nor a loss on the disposal.  The ‘market value’ rule in TCGA92/S17(1) does not apply to such disposals.


The basic requirements of the relief are that

  • a person other than a company, referred to as ‘P’,
  • disposes of ordinary share capital of a company, referred to as ‘C’, to the trustees of a settlement,
  • the ‘relief requirements’ are all met, and
  • P makes a claim.


Relief is also available where there is a deemed disposal by reason of the trustees of a settlement becoming absolutely entitled as against the trustees of settled property (‘the transferring trustee’) and

  • that settled property is the ordinary share capital of a company,
  • the relevant ‘relief requirements’ are met, and
  • the ‘transferring trustee’ makes a claim.

Although TCGA92/S236H(1)(a) states that P cannot be a company, this does not apply to corporate trustees who can still make a claim.