Section 43

(1) Where an asset is lost or destroyed, and a capital sum received Assets lost
by way of compensation for the loss or destruction is applied within three or destroyed
years of receipt in acquiring another asset in its replacement, the owner shall,
where the compensation received together with the residual or scrap value
is –
(a) greater than the cost of the asset acquired in replacement of the lost
or destroyed asset, be deemed to make a chargeable gain; and
(b) lower than the cost of the asset acquired in its replacement, be deemed, First
for the purposes of the First Schedule to this Act, to have acquired an Schedule
additional asset for an amount equal to the cost of that new asset, less the
compensation together with the residual or scrap value.
(2) Except for the additional asset acquired under subsection (1)(b), al- First
lowance to be claimed on the new asset for the purposes of the First Schedule Schedule
to this Act shall be limited to the residue of the old asset, if any.