IRC v Montgomery [1975] 49 TC 679

A building owned by the trustees was damaged by fire and they became entitled to recover insurance money. 

The husband of one of the trustees paid them for an assignment of the trustees' rights under the policies. In due course the insurers paid the husband sums totalling £75,192.

As the law then stood rights under insurance policies were not “assets” for CGT purposes.

The Crown contended that the money was a “capital sum derived from assets”, i.e. the damaged property, and was therefore liable to CGT by virtue of what is now s22(1).