Commentary

C2.503 Damage or injury to assets

Capital gains tax
Capital gains tax | Commentary

C2.503 Damage or injury to assets

Capital gains tax | Commentary

C2.503 Damage or injury to assets

The receipt of compensation or insurance proceeds in respect of damage or injury to assets is a disposal to the extent that the receipt is a capital sum1. Where the asset continues in existence and is not disposed of by the owner, the receipt of compensation etc is a part disposal, and the allowable expenditure is apportioned accordingly2.

Example 1

TG owns a house which cost £80,000 in March 2013. In January 2017, the house was badly damaged by a falling tree and TG sued the neighbouring owner for damages. In July 2017, the action was

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