Taxes Consolidation Act 1997 section 848K

Gain on cessation

Section 848K set out how a gain was calculated when a special savings incentive account (SSIA) was treated as ceasing.

• Where an SSIA was treated as ceasing (i.e. the account terms were broken by the individual), a gain was treated as accruing on the account on the day of cessation.
• The amount of the gain was equal to the aggregate market value of all assets, including cash, held in the account on that day.
• This meant the entire value of the SSIA funds became subject to the 23 per cent tax rate on cessation.
• The gain on cessation was therefore calculated by reference to the total value of the account, not merely any investment return or growth element.