Section 25 Value shifting.
United Kingdom
Without prejudice to the generality of the provisions of this Act as to the transactions which are disposals of assets, any transaction which under the following subsections is to be treated as a disposal of an asset shall be so treated (with a corresponding acquisition of an interest in the asset) notwithstanding that there is no consideration and so far as, on the assumption that the parties to the transaction were at arm’s length, the party making the disposal could have obtained consideration, or additional consideration, for the disposal the transaction shall be treated as not being at arm’s length and the consideration so obtainable, or the additional consideration so obtainable added to the consideration actually passing, shall be treated as the market value of what is acquired.
If a person having control of a company exercises his control so that value passes out of shares in the company owned by him or a person with whom he is connected, or out of rights over the company exercisable by him or by a person with whom he is connected, and passes into other shares in or rights over the company, that shall be a disposal of the shares or rights out of which the value passes by the person by whom they were owned or exercisable.
A loss on the disposal of an asset shall not be an allowable loss to the extent to which it is attributable to value having passed out of other assets, being shares in or rights over a company which by virtue of the passing of value are treated as disposed of under subsection (2) above.
If, after a transaction which results in the owner of land or of any other description of property becoming the lessee of the property there is any adjustment of the rights and liabilities under the lease, whether or not involving the grant of a new lease, which is as a whole favourable to the lessor, that shall be a disposal by the lessee of an interest in the property.
If an asset is subject to any description of right or restriction the extinction or abrogation, in whole or in part, of the right or restriction by the person entitled to enforce it shall be a disposal by him of the right or restriction.
Notes on the whole Act
Textual amendments
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Act repealed (6.3.1992 with effect as mentioned in s. 289(1)(2) of the repealing Act) by Taxation of Chargeable Gains Act 1992 (c. 12), ss. 289, 290, Sch.12 (with s. 201(3), Sch. 11 paras. 20, 22, 26(2), 27 and with saving in Sch. 11 para. 24(2)) and subject to an amendment (prosp.) by Museum and Galleries Act 1992 (c. 44), s. 11(2), Sch. 8 Pt. I para. 1(1)(2)(7), and amendments by: Disability Living Allowance and Disability Working Allowance Act 1991 (c. 21), s. 4(2), Sch. 2 para. 9(1)(2) (in force 6.4.1992 by S.I. 1991/2617, art. 2(f)); S.I. 1991/2874, art. 2 (in force 6.4.1992 by S.R. 1992/94, art. 2); Social Security (Consequential Provisions) Act 1992 (c. 6), s. 4, Sch. 2 para. 52(a)(b) (in force 1.7.1992 by s. 7(2) of the amending Act); Social Security (Consequential Provisions) (Northern Ireland) Act 1992 (c. 9), s. 4, Sch. 2 para. 20(a)(b) (in force 1.7.1992 by s. 7(2) of the amending Act); Finance (No. 2) Act 1992 (c. 48), ss. 35(2), 47, 48, 56, 77, Sch. 9 para. 20(1)(inserting ss. 143A and 143B), Sch. 17 paras. 3, 6(2)(5), 7, (the amendments coming into force 16.7.1992 except for the amendment by s. 56, Sch. 9 para. 20(1) which comes into force on 19.2.1993 by S.I. 1993/236, art. 2); and amendments (retrospective to 1.1.1992) by ss. 35(2), 47, 48 of the same 1992 Act, and amendments (27.7.1993 with effect as mentioned in ss. 84(3), 86(4), 88(4), 105(4) of the amending Act) by 1993 c. 34, ss. 84(3), 86(4), 88(4)(a)(b), 105(3)(4)