Michael Collins (Temple Tax Chambers) looks at the unfortunate consequences of new FA 1986 s 77A for share-for-share exchanges in advance of company reorganisations.
The progress of the FA 2016 had an unpleasant surprise for practitioners in company taxation. The tightening of the transactions in securities provisions and the targeted anti-avoidance rule for close company liquidations had been widely trailed. But at committee stage and without any prior consultation the government tabled an amendment to FA 1986 s 77.
Most practitioners will be familiar with s 77. It is the means by which a new holding company can be inserted above an existing company without incurring a charge to stamp duty. The new holding company (referred to in the legislation as ‘the acquiring company’) acquires the shares in the existing company (‘target’) and in exchange issues shares to the shareholders in target. Provided the shareholders and their shareholdings...
If you or your firm subscribes to Taxjournal.com, please click the login box below:
If you do not subscribe but are a registered user, please enter your details in the following boxes:
Michael Collins (Temple Tax Chambers) looks at the unfortunate consequences of new FA 1986 s 77A for share-for-share exchanges in advance of company reorganisations.
The progress of the FA 2016 had an unpleasant surprise for practitioners in company taxation. The tightening of the transactions in securities provisions and the targeted anti-avoidance rule for close company liquidations had been widely trailed. But at committee stage and without any prior consultation the government tabled an amendment to FA 1986 s 77.
Most practitioners will be familiar with s 77. It is the means by which a new holding company can be inserted above an existing company without incurring a charge to stamp duty. The new holding company (referred to in the legislation as ‘the acquiring company’) acquires the shares in the existing company (‘target’) and in exchange issues shares to the shareholders in target. Provided the shareholders and their shareholdings...
If you or your firm subscribes to Taxjournal.com, please click the login box below:
If you do not subscribe but are a registered user, please enter your details in the following boxes:
