Introduction Details of the Schedule
2.Paragraph 2 amends section 263B (stock lending arrangements) of the Taxation of Chargeable Gains Act 1992 (TCGA). Sub-paragraph (2) of paragraph 2 inserts into section 263B(2) a reference to section 263CA, which is introduced into the TCGA by paragraph 3 of the Schedule. This ensures that section 263B interacts correctly with the new section 263CA.
3.Sub-paragraph (3) makes three amendments to section 263B(4) of TCGA. The first two make explicit that, where there is a deemed disposal by a stock lender of securities that have been lent and will not be returned, the consideration for that deemed disposal is the market value of those securities at the time it becomes clear that they will not be returned to the borrower. It has always been accepted that this is the case, but the opportunity has been taken to make it explicit.
4.The third amendment to section 263B(4) provides that that subsection will not apply if the new section 263CA has effect. This prevents any confusion as to which provisions apply.
5.Sub-paragraph (4) of paragraph 2 removes from section 263B(7) a definition of “interest” that does not apply within section 263B and so is not needed.
6.Paragraph 3 of the Schedule inserts the new section 263CA into the TCGA.