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Chapter CG15089

Document Cited authorities 1 Cited in Related
Vincent
Published date12 March 2016
Record NumberCG15089
CourtHM Revenue & Customs
IssuerHM Revenue & Customs
TCGA92/S279B

A right to unascertainable consideration is defined as follows for the purposes of TCGA92/S279A (see the fifth condition in CG15084 above).

A right is a right to unascertainable consideration if the amount or value of the consideration cannot be determined when the right is conferred because it is to any extent referable to matters which are uncertain because they have not yet occurred, subject to the exceptions below.

An example of a right to unascertainable consideration for the sale of company shares would be a right to a cash payment whose amount depends on the level of the company’s profits for the two years following the sale.

Exceptions

1) The amount or value of any consideration is not regarded as being unascertainable for the purposes of TCGA92/S279A simply because either of two circumstances apply:

i) where the right to receive the whole or any part of the consideration for the disposal of an asset is postponed or contingent, but the amount or value, or the part of it in question, is taken into account under TCGA92/S48, see CG14881, in computing the gain on the disposal of the asset in question. For example, where consideration is payable by fixed instalments, or where consideration is fixed in amount, but is contingent upon a future event, such as the granting of planning permission to develop a piece of land, TCGA/S48 will have effect to bring the whole of the deferred or contingent consideration into account in computing the gain on the disposal and the consideration will not be “unascertainable consideration” for the purposes of TCGA/S279B;

ii) where a choice exists between alternative forms of consideration. For example, if the...

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