GOV.UK
Land: part-disposals: example
Over a period of years, an individual acquires land as follows
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A farm by inheritance;
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Adjacent land by purchase;
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The house and garden on the farm by gift.
The whole of the farm is used in the individual's trade as a single unit.
The individual then sells a strip of land to the local authority as part of a road-widening scheme. The strip amounts to half of the land in (b) and part of the garden in (c). In calculating the chargeable gain arising on the disposal of the strip of land, the part-disposal rules should only be applied to (b) and (c). Parts (b) and (c) are separate assets and therefore need to be valued separately. Each of these parts is a separate asset for the purposes of applying the `kink test’, see CG16730+, and for the purposes of electing for 6 April 1965 valuation, see CG15525+.
The land in (a) is also a separate asset, but it does not enter into the computation on this particular occasion.