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Capital Gains Tax

Volume 29: debated on Thursday 28 October 1982

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asked the Chancellor of the Exchequer if it is the practice of the Inland Revenue that, where United Kingdom resident trustees receive foreign currency settled by an individual not resident in the United Kingdom, United Kingdom capital gains tax is chargeable on all realisations, including expenditure of that currency with no allowable costs.

The capital gains tax legislation treats foreign currency as a chargeable asset, and gains realised on its disposal (including a disposal by trustees), whether by sale or by exchange for goods or services, may therefore give rise to a tax charge. But in calculating gains arising on the disposal of an asset acquired by trustees from a non resident settlor, the capital gains tax rules permit a deduction in the tax computation for the actual cost of acquisition (if any) and any costs incidental to the acquisition and disposal.If my hon. Friend has any specific case in mind he might care to write to me about it.