Taxes Consolidation Act 1997 section 311

Apportionment of consideration and exchanges and surrenders of leasehold interests

Section 311 sets out the rules for apportioning sale proceeds, insurance moneys and other compensation among multiple assets disposed of in a single transaction, and extends the meaning of "sale" to include exchanges and surrenders of leasehold interests.

• Where two or more assets are sold together, the total net proceeds must be divided among them on the basis of a just apportionment, regardless of any separate prices purportedly agreed between the parties.
• The same just apportionment rules apply where a single insurance, salvage or compensation payment is received in respect of multiple assets.
• The term "sale" is extended to cover exchanges of property and surrenders of leasehold interests for valuable consideration, with references to sale proceeds being read as references to the consideration received.
• The transfer of an industrial building or structure to a trustee under a Debt Settlement Arrangement or Personal Insolvency Arrangement is not treated as an exchange, so such a transfer does not trigger a balancing allowance or charge.