A form of roll-over relief applies where an asset is lost or destroyed such that compensation or insurance proceeds are received in respect of it (and a disposal results: see ¶514-800), if the whole of the capital sum is re-invested in a replacement asset within one year of receipt (or longer if the inspector allows). The relief, if required, must be claimed by the owner and operates as follows (TCGA 1992, s. 23(4)):

the gain on the disposal of the old asset (i.e. that deemed to arise from the receipt of the compensation or insurance money) is reduced so as to give rise to neither a gain nor a loss; and

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