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Legislation
Income Tax (Trading and Other Income) Act 2005

Crossheading Special rules for strips of government securities

  • Section 443 Application of this Chapter to strips of government securities
  • Section 444 Meaning of “strip” in Chapter 8
  • Section 445 Strips of government securities: acquisitions and disposals
  • Section 446 Strips of government securities: relief for losses
  • Section 447 Restriction of profits on strips by reference to original acquisition cost
  • Section 448 Restriction of losses on strips by reference to original acquisition cost
  • Section 449 Strips of government securities: manipulation of acquisition, transfer or redemption payments
  • Section 450 Market value of strips etc.
  • Section 451 Market value of strips etc. quoted in foreign stock exchange lists
  • Section 452 Power to modify this Chapter for strips
  1. Special rules for strips of government securities
  2. Restriction of profits on strips by reference to original acquisition cost

Section 447 | Restriction of profits on strips by reference to original acquisition cost

From legislation.gov.uk

(1)This section applies if—

(a)a person makes a profit on the disposal of a strip (apart from this section), and

(b)the person's original acquisition cost for the strip (see subsection (4)) exceeds the amount that falls to be brought into account as the amount paid by the person to acquire the strip in determining the amount of the profit.

(2)If the amount that falls to be brought into account as the amount payable on the disposal in determining the amount of the profit exceeds the person's original acquisition cost for the strip, the amount of the profit is restricted to that excess.

(3)Otherwise the person is treated as not making a profit on the disposal.

(4)For the purposes of this section and section 448, a person's original acquisition cost for a strip is the amount that falls to be taken into account as the amount paid by the person to acquire the strip in determining whether the person makes a profit or loss on its disposal if 5th April disposals and acquisitions are ignored.

(5)In subsection (4) “5th April disposals and acquisitions” means—

(a)disposals under section 445(2) (other than the disposal in question), and

(b)acquisitions under section 445(3).

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