Taxation logo taxation mission text

Since 1927 the leading authority on tax law, practice and administration

Interaction of property taxes on demolition

22 September 2020 / Rob Durrant-Walker
Issue: 4761 / Categories: Comment & Analysis
Chaos theory

Key points

  • Consequences of failing to demolish an entire building before new construction.
  • Conditions for capital loss claims under TCGA 1992 s 24.
  • Effect of TCGA 1992 s 41 on capital allowances.
  • Surrendering a loss to a member of the same corporate group.
  • Anomaly in the legislation if a demolition is not complete.


This is a tale akin to chaos theory in physics when a butterfly flaps its wings and far away something much bigger happens that a business could not anticipate. Well here is a builder’s jam tart addiction a demolition that left a small brick wall standing and an HMRC tax challenge on the interaction between capital gains capital allowances and capital gains tax losses.


Statutory references are to TCGA 1992 unless otherwise specified.

Scene is set

Hermione Haggerty owner of Barnstoneworth United football club group sat befuddled at...

If you or your firm subscribes to, please click the login box below:

If you are not a subscriber but are a registered user or have a free trial, please enter your details in the following boxes:

Alternatively, you can register free of charge to read a limited amount of subscriber content per month.
Once you have registered, you will receive an email directing you back to read this item in full.

Please reach out to customer services at +44 (0) 330 161 1234 or '' for further assistance.

back to top icon