CheckLists.Tax (beta)
B1. Sale, disposal, assignment
FORMALITIES
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Assignment of choses in action
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- Formalities for absolute assignment at law of debt/contractual right/chose in action
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- LPA s.136 provides for the "absolute assignment" of "any debt or other legal thing in action".
- Must be by writing under the hand of the assignor and express notice must be given to the debtor.
Legislation:
Cases:
Good v. HMRC [2023] EWCA Civ 114;
HMRC manuals:
Commentary:
See also:
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- Conditional assignment of debt/contractual right/chose in action only valid in equity
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- LPA s.136 provides for the "absolute assignment" of "any debt or other legal thing in action".
- If assignment only operates until, for instance, a debt has been discharged, it is conditional (Good, §103).
- If only valid in equity, assignor retains legal title to the chose in action and a right to the benefit of it subject to the condition being satisfied (which may give rise to entitlement to income).
Legislation:
Cases:
Good v. HMRC [2023] EWCA Civ 114;
HMRC manuals:
Commentary:
See also:
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- General points re assignment
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- No assignment of future chose in action, but difficult distinction to draw (Burley, §96).
- Query whether assignment can be effected by agreement to which purported assignee is not a party (Burley §97).
- Query whether consideration for the assignment needs to flow from the assignee (Burley, §100).
- Prohibitions on assignment do not prevent assignment being effective as between assignor and assignee but may affect the position between the assignor and their counterparty (Burley §101).
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Legislation:
Cases:
(Burley v. HMRC [2025] UKFTT 989 (TC), Judge Baldwin)
HMRC manuals:
Commentary:
See also:
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- Little difference between legal and equitable assignment
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- "[95] Although this transaction did not fulfil the requirements to be an assignment at law, it is perfectly possible for an assignment to take effect in equity. It has been observed (Guest on the Law of Assignment, 5th ed, para 2-03) that, except for the procedural advantages which attach to the statutory assignee's legal title to sue and the absence of any requirement of consideration for a statutory assignment, there is little difference between an equitable assignment and a statutory assignment." (Burley v. HMRC [2025] UKFTT 989 (TC), Judge Baldwin)
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INCOME TAX
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Trading income
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- Identifying trading receipts
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XX
Legislation:
Cases:
HMRC manuals:
Commentary:
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Sale of occupation income​
XX
XX
Legislation: ITA s.780
Cases:
HMRC manuals:
Commentary:
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Sale with foreign currency elements
Correct approach to calculating gains
XX
Legislation:
Cases: Rawlings v HMRC [2022] UKFTT 32 (TC), Judge Amanda Brown QC
HMRC manuals:
Commentary:
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XX
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- Situs of assets
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- Contractual obligation usually situated in the country in which it can be enforced (HMRC v. Royal Bank of Canada [2025] UKSC 2, §48).
Legislation:
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Transfer of assets abroad
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- Disposal of asset to non-resident person by individual/closely held company as a relevant transfer
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- See i1. Creation and addition to trust.
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Legislation:
Cases:
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Commentary:
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INHERITANCE TAX
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XX
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- Sale for less than market value as a transfer of value/gift
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XX
Legislation:
Cases:
HMRC manuals:
Commentary:
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- Sale to company in return for shares in company (query whether shares worth less)
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- Minority interest in company owning listed shares is worth less than outright ownership of the equivalent number of shares (Battle).
- Even sale in return for 98% was thought to carry a 2.5% discount (Battle at 93).
Legislation:
Cases: Battle v. IRC [1980] STC 86;
HMRC manuals:
Commentary:
See also:
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Gift with reservation of benefit
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- XX
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XX
Legislation:
Cases:
HMRC manuals:
Commentary:
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