Taxes Consolidation Act 1997 section 611

Disposals to State, public bodies and charities

Section 611 provides relief from capital gains tax on disposals of assets to the State, charities, and certain specified public and cultural bodies, where the disposal is not made at arm's length.

• Where an asset is disposed of otherwise than by a bargain at arm's length to the State, a charity, or a specified body, the normal market value rule in section 547 does not apply to the disposal.
• If the disposal is a gift or for a consideration not exceeding the cost of the asset, it is treated as made for a consideration producing neither a gain nor a loss; if the consideration exceeds cost but is below market value, the gain is calculated on the actual consideration received.
• If a charity or specified body later disposes of the asset in circumstances where the resulting gain would be chargeable, the CGT that would have been payable on the original disposal (had section 547 applied) is clawed back and charged on the charity or body in addition to any CGT on its own gain.
• Similar no-gain-no-loss treatment applies to deemed disposals of settled property under sections 576(1) and 577(3) where trust assets pass to or are held for the State, a charity, or a specified body, provided no consideration is received by any person in connection with the transaction.