(1)Income tax is charged on income treated as arising under section 756 (income treated as arising when gains obtained from some land disposals).
(2)For exemptions from the charge, see—
section 765 (exemption: gain attributable to period before intention to develop formed),
section 766 (exemption: disposals of shares in companies holding land as trading stock), and
section 767 (exemption: private residences).
(1)This section applies if—
(a)any of the conditions specified in subsection (3) is met as respects land,
(b)a gain of a capital nature is obtained from the disposal of all or part of the land,
(c)all or part of the land is situated in the United Kingdom, and
(d)a person within section 757(1)(a), (b) or (c) obtains the gain.
(2)The gain is treated for income tax purposes as income arising when the gain is realised.
(3)The conditions are that—
(a)the land is acquired with the sole or main object of realising a gain from disposing of all or part of the land,
(b)any property deriving its value from the land is acquired with the sole or main object of realising a gain from disposing of all or part of the land,
(c)the land is held as trading stock, and
(d)the land is developed with the sole or main object of realising a gain from disposing of all or part of the land when developed.
(4)It does not matter for the purposes of this section whether the person within section 757(1)(a), (b) or (c) obtains the gain for that person or another person.
(5)For the purposes of this section, if, for example by a premature sale, a person (“A”) directly or indirectly transmits the opportunity of realising a gain to another person (“B”), A obtains B’s gain for B.
(6)For the meaning of “another person”, see section 763.
(1)The persons referred to in section 756(1)(d) are—
(a)the person acquiring, holding or developing the land,
(b)a person connected with a person within paragraph (a), and
(c)a person who is a party to, or concerned in, an arrangement or scheme within subsection (2).
(2)An arrangement or scheme is within this subsection if—
(a)it is effected as respects all or part of the land, and
(b)it enables a gain to be realised—
(i)by any indirect method, or
(ii)by any series of transactions.
(3)For the purposes of this section any number of transactions may be regarded as constituting a single arrangement or scheme if—
(a)a common purpose can be discerned in them, or
(b)there is other sufficient evidence of a common purpose.
(1)Tax is charged under this Chapter on the full amount of income treated as arising in the tax year.
(2)See section 760 (method of calculating gain) for how to calculate the amount of income charged.
(1)The person liable for any tax charged under this Chapter on income is the person whose income it is.
(2)The general rule is that that person is the person who realises the gain.
(3)But that rule is subject to subsections (4) and (6).
(4)If all or any part of the gain accruing to a person (“A”) is derived from value provided directly or indirectly by another person (“B”), the income is B's.
(5)Subsection (4) applies whether or not the value is put at the disposal of A.
(6)If all or any part of the gain accruing to a person is derived from an opportunity of realising a gain provided directly or indirectly by another person, the income is the other person's.
(7)For the meaning of “another person”, see section 763.
(8)In applying section 1015 (territorial scope of charges including the charge under this Chapter) for the purposes of this Chapter, an amount treated as arising to a non-UK resident under section 756 is treated as being from a source in the United Kingdom so far (and only so far) as the land to which the disposal relates is in the United Kingdom.
(1)Subsections (3) to (5) apply for calculating a gain for the purposes of this Chapter.
(2)But, except so far as those subsections make provision, such method is to be used for those purposes as is just and reasonable in the circumstances.
(3)The method must—
(a)take into account the value of what is obtained for disposing of the land, and
(b)allow only such expenses as are attributable to the land disposed of.
(4)If a freehold is acquired and on disposal the reversion is retained, account may be taken of the way in which trading profits are calculated in such a case.
(5)Account may be taken of the adjustments to be made in calculating trading profits under section 158 of ITTOIA 2005 (lease premiums etc: reduction of receipts).
(6)In this section “trading profits” means the profits under Part 2 of ITTOIA 2005 (trading profits) of a person dealing in land.
(7)In the application of this section in Scotland—
“freehold” means the interest of the owner, and
“reversion” means the interest of the landlord in property subject to a lease.
(8)See also section 764 (valuations and apportionments).