In a 'slice of the action' contract ICTA88/S776 (2)(c) is
Where this subsection is in point there is a restriction on the overall gain that can be charged to Income Tax under ICTA88/776. This restriction is at ICTA88/776 (7). ICTA88/776 (7) takes out of the charge to Income Tax so much of the gain as is attributable to the period before the intention to develop the land was formed.
Any gain which has accrued whilst the land functioned as a capital asset will not therefore come within ICTA88/776. ICTA88/776 (7) ensures that the Income Tax charge will operate only on the gain arising after the intention to develop has been formed (see example at BIM60365).
The 'first intention date' is a question of fact, which should, if possible, be agreed with the other side at an early stage in the enquiries. When it has been established you should obtain a valuation of the land from the District Valuer at that date.
CG72856 deals with the assessment to Capital Gains Tax of the gain attributable to the period before the intention to develop the land was formed.