Section 225BA Deferred payments on disposals in connection with divorce etcF1

(1)

This section applies where—

(a)

an individual (“A”) ceases to live with A’s spouse or civil partner (“B”) in a dwelling-house or part of a dwelling-house,

(b)

immediately before A ceases to live with B, the dwelling-house or part is A’s only or main residence,

(c)

A disposes of, or of an interest in, that dwelling-house or part to B (“the initial disposal”), and

(d)

the initial disposal is in accordance with a deferred sale agreement or order.

(2)

If—

(a)

in accordance with the deferred sale agreement or order A receives a sum in respect of a share of any profit made by B upon B’s disposal of, or of an interest in, the dwelling-house or part, and

(b)

the receipt of that sum would be treated (apart from this section) as a disposal falling with section 22 (disposal where capital sums derived from assets),

that receipt is to be treated for the purposes of this Act as a gain attributable to the initial disposal but accruing to A at the time the sum is received.

(3)

In this section, a “deferred sale agreement or order” is an agreement or order of a court which—

(a)

is within paragraph (a) or (b), as the case may be, of section 225B(2) (agreements and orders of the court in relation to divorce etc), and

(b)

includes a term entitling A to receive a share of any profit made by B as mentioned in subsection (2)(a).

Annotations

Textual amendments

F1: S. 225BA inserted (6.4.2023 in relation to disposals made on or after that date) by Finance (No. 2) Act 2023 (c. 30), s. 41(4)(6)