Where an asset is disposed of otherwise than under a bargain at arm’s length to a charity or to any scheduled body (as detailed in IHTA 1984, Sch. 3), and the disposal is not of venture capital trust shares, the market value rule does not apply and unless the consideration exceeds the base cost the disposal takes place at no gain/no loss (TCGA 1992, s. 257(1), (2)(a)).

If the asset is later disposed of by the acquirer, the latter is treated as having acquired it when the disponor did (TCGA 1992, s. 257(2)(b), (4)). If the acquirer is itself a charity, the later disposal may itself be exempt from CGT (see ¶589-100).

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