Capital Gains on Insurance Claims For Damage or Destruction of Capital Asset - (New) Section 67(2) / (Old) Section 45(1A)

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.... income of the tax year in which the insurance money or replacement asset is received, irrespective of when the loss or destruction occurred. 3. Deemed Full Value of Consideration For the purpose of computing capital gains under Section 72, the following shall be treated as the full value of consideration: • the amount of money received from the insurer; or • the fair market value of any asset received from the insurer on the date of receipt. 4. Applicability  The provision applies only when the damage or destruction of the capital asset results from any of the following events: (a) Natural Calamities • Flood • Typhoon • Hurricane • Cyclone ....

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....f consideration In order to compute capital gain, the value of any money or the fair market value of other assets on the date of such receipt shall be deemed to be the full value of the consideration received or accruing as a result of the transfer of such capital gain. NOTES: • If no claim is received on destruction of capital asset, no capital gain shall arise. The cost of the asset destroyed shall be a capital loss i.e. dead loss which has no tax treatment. • For the purposes of computing the nature of capital gains, the date of transfer of the capital asset destroyed should mean the date of destruction. • The capital will arise in the previous year in which the money or other asset is receive....