The London Capital and Finance Compensation Scheme (Chargeable Gains Exemption) Regulations, SI 2021/1385 exempt from capital gains tax compensation payments made to former customers of London Capital and Finance plc (LCF) under the LCF compensation scheme.
The scheme compensates customers of LCF who were adversely affected by losses from investments in that company. In accepting a compensation payment under the scheme, customers transfer to the scheme operator their rights to claim against LCF in respect of their losses.
FA 2020 Sch 15 provides for exemptions from tax in respect of qualifying payments. Para 4 provides for an exemption from CGT where a disposal arises as a result of a person forfeiting, surrendering or refraining from exercising rights in return for a qualifying payment and on a disposal of the right to receive a qualifying payment.
The regulations specify that a compensation payment made under the scheme is a qualifying payment for the purposes of para 4.
The regulations come into force on 2 January 2022 and have effect in relation to disposals made on or after 20 October 2021.
The London Capital and Finance Compensation Scheme (Chargeable Gains Exemption) Regulations, SI 2021/1385 exempt from capital gains tax compensation payments made to former customers of London Capital and Finance plc (LCF) under the LCF compensation scheme.
The scheme compensates customers of LCF who were adversely affected by losses from investments in that company. In accepting a compensation payment under the scheme, customers transfer to the scheme operator their rights to claim against LCF in respect of their losses.
FA 2020 Sch 15 provides for exemptions from tax in respect of qualifying payments. Para 4 provides for an exemption from CGT where a disposal arises as a result of a person forfeiting, surrendering or refraining from exercising rights in return for a qualifying payment and on a disposal of the right to receive a qualifying payment.
The regulations specify that a compensation payment made under the scheme is a qualifying payment for the purposes of para 4.
The regulations come into force on 2 January 2022 and have effect in relation to disposals made on or after 20 October 2021.
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