cgta79/s147.- Capital Gains Tax Act 1979 Section 147 Works of art etc.

(B) - CAPITAL GAINS TAX

* * * * *

147. -

[1965 s.31(5).]

(5) If -

(a) there is a sale of the asset ¹ and [inheritance tax ² is chargeable under section [32 of the Inheritance Tax Act 1984 ³ ] (or would be chargeable if an [inheritance tax ² ] undertaking as well as an undertaking under this section had been given), or

(b) The Treasury ⁴ are satisfied that at any time during the period for which any such undertaking was given it has not been observed in a material respect,

the person selling that asset or, as the case may be, the owner of the asset shall be treated for the purposes of this Act as having sold the asset for a consideration equal to its market value, and, in the case of a failure to comply with the undertakings, having immediately re-acquired it for a consideration equal to its market value.

* * * * *

[1965 s.31(8).]

(8) If in pursuance of subsection (5) above a person is treated as having on any occasion sold an asset and [inheritance tax ² ] becomes chargeable on the same occasion, then, in determining the value of the asset for the purposes of that tax, an allowance shall be made for the capital gains tax chargeable on any chargeable gain accruing on that occasion.

`[1965 s.31(9).]

(9) In this section "[inheritance tax ² ] undertaking" means an undertaking under [Chapter II of Part II or section 78 of, or Schedule 5 to, the Inheritance Tax Act 1984 ⁵ ] sections 76 to 81 of the Finance Act 1976 or section 31 or 34 of the Finance Act 1975.

1 In view of subs. (3) of this section, "the asset" means any asset which is property which has been or could be designated under IHTA 1984 s.31.

2 See 1986 s.100(1) and (2) - for any liability to tax arising on and after 25 July 1986 any reference in the legislation to capital transfer tax has effect as a reference to inheritance tax.

3 Originally "78 of the Finance Act 1976". Amended to "32 of the Capital Transfer Tax Act 1984" by CTTA, Sch. 8, para. 10(5) with effect from 1 January 1985, and by 1986 s.100(1) =, on and after 25 July 1986 the Capital Transfer Tax Act 1984 may be cited as the Inheritance Tax Act 1984.

4 By 1985 s.95, the functions of the Treasury were transferred to the Commissioners of Inland Revenue ("the Board").

5 CTTA Sch. 8, para 10(7), with effect from 1 January 1985. By 1986 s.100(1), on and after 25 July 1986 the Capital Transfer Tax Act 1984 may be cited as the Inheritance Tax Act 1984.