The First-tier Tribunal’s ruling in Osmond and Allen reveals a mistaken approach to the transactions in securities rules, and to purpose tests in general, writes Thomas Chacko (Pump Court Tax Chambers).
In 1996 and 1998 Hugh Osmond and Matthew Allen (‘Osmond and Allen’) subscribed for shares in Xercise Ltd under the terms of the Enterprise Investment Scheme (EIS). One of the advantages of the EIS regime is that shares within it are generally exempt from CGT (TCGA 1992 s 150A).
Xercise ran a sports club in Great Yarmouth. The club was unsuccessful and the business was sold in 2002. However Osmond and Allen were keen to hold on to the potential advantages of holding EIS-qualifying shares and so persuaded the other shareholders not to dissolve or sell the company but instead to purchase its own shares out of capital so as to leave Osmond and Allen...
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The First-tier Tribunal’s ruling in Osmond and Allen reveals a mistaken approach to the transactions in securities rules, and to purpose tests in general, writes Thomas Chacko (Pump Court Tax Chambers).
In 1996 and 1998 Hugh Osmond and Matthew Allen (‘Osmond and Allen’) subscribed for shares in Xercise Ltd under the terms of the Enterprise Investment Scheme (EIS). One of the advantages of the EIS regime is that shares within it are generally exempt from CGT (TCGA 1992 s 150A).
Xercise ran a sports club in Great Yarmouth. The club was unsuccessful and the business was sold in 2002. However Osmond and Allen were keen to hold on to the potential advantages of holding EIS-qualifying shares and so persuaded the other shareholders not to dissolve or sell the company but instead to purchase its own shares out of capital so as to leave Osmond and Allen...
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If you do not subscribe but are a registered user, please enter your details in the following boxes:
