Commentary

C1.505 CGT losses—Assets extinguished or destroyed

Capital gains tax
Capital gains tax | Commentary

C1.505 CGT losses—Assets extinguished or destroyed

Capital gains tax | Commentary

C1.505 CGT losses—Assets extinguished or destroyed

Where an asset is entirely lost, destroyed, dissipated or extinguished, it is deemed to have been disposed of on the occurrence of the loss etc, whether or not any capital sum is received as compensation1. There is an exception for options (other than certain quoted options and financial options) which are abandoned without being exercised, and the abandonment of the option is not treated as a disposal2. Similar treatment is applied to the forfeiture of a deposit or other consideration money for a purchase transaction which is abandoned3.

In cases where compensation or insurance proceeds

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