Finance Act 1972

Issues of bonus redeemable share capital and bonus securities

2 (1) Paragraph (c) of the said subsection (2) (redeemable share capital or security issued by company in respect of shares otherwise than for new consideration) shall apply also to any such capital or security issued after 5th April 1972 as is mentioned in that paragraph but in respect of securities and not shares, and accordingly for that paragraph there shall be substituted—

“(c) any redeemable share capital or any security—

(i) issued by the company in respect of shares in the company; or

(ii) issued by the company after 5th April 1972 in respect of securities of the company,

otherwise than wholly for new consideration, or such part of any redeemable share capital or any security so issued as is not properly referable to new consideration;”

and paragraph (d)(i) of that subsection (interest on securities mentioned in the said paragraph (c)) shall have effect accordingly.

(2) For the purposes of the said paragraph (c)—

(a) the value of any redeemable share capital shall be taken to be the amount of the share capital together with any premium payable on redemption, or in a winding up, or in any other circumstances; and

(b) the value of any security shall be taken to be the principal amount thereby secured (including any premium payable at maturity or in a winding up or in any other circumstances) ;

and in determining the amount of the distribution constituted by the issue of any redeemable share capital or any security, the capital or security shall be taken at that value.