Taxes Consolidation Act 1997 section 542

Time of disposal and acquisition

Section 542 sets out rules for determining the time at which a disposal and acquisition of an asset takes place for capital gains tax purposes.

• Where an asset is disposed of under an unconditional contract, the disposal date is the date the contract is made, not the date the asset is conveyed or transferred.
• Where a contract is conditional (including where it is conditional on the exercise of an option), the disposal date is the date the condition is satisfied.
• For compulsory acquisitions of land, the disposal date is generally when compensation is received; for compensation received on or after 1 January 2016 this is explicitly confirmed by subsections (1A) and (1B).
• Where a capital sum is received in respect of damage to, forfeiture of rights over, or exploitation of an asset under section 535, the disposal date is the date the sum is received.