Taxes Consolidation Act 1997 section 547

Section 547 sets out the circumstances in which market value is substituted for the actual consideration on the acquisition or disposal of an asset for capital gains tax purposes.

• Where an asset is acquired other than by an arm's length bargain, by way of a company distribution, for consideration that cannot be valued, or in connection with a loss of employment or recognition for past services, the acquisition cost is deemed to be the asset's market value.
• Where a company allots shares to a connected person other than at arm's length, the acquisition cost is the lower of the price paid and the increase in value of the person's total shareholding resulting from the allotment.
• The market value substitution on acquisition does not apply where there is no corresponding disposal of the asset and either no consideration is given or the consideration is less than market value.
• Where an asset is disposed of other than by an arm's length bargain or for consideration that cannot be valued, the disposal proceeds are deemed to be the asset's market value.