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Finance Act 1999, Section 118 is up to date with all changes known to be in force on or before 09 September 2024. There are changes that may be brought into force at a future date. Changes that have been made appear in the content and are referenced with annotations.
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(1)After section 95 of the M1Finance Act 1986 (depositary receipts: exceptions) insert—
(1)There shall be no charge to tax under section 93 above in respect of the transfer, issue or appropriation of chargeable securities (“the new securities”) issued by a company in place of existing securities of the same company (“the old securities”) if the following conditions are met.
(2)The first condition is that the old securities are held under a depositary receipt scheme.
(3)The second condition is that—
(a)there was a charge to tax under section 93 above in respect of the transfer, issue or appropriation—
(i)of the old securities, or
(ii)of earlier securities in relation to which on a previous application of this section those securities were the new securities,
or there would have been such a charge if that section had been in force; or
(b)there would have been such a charge but for section 95(2) or (3) above.
(4)The third condition is that there is an arrangement under which—
(a)the new securities are transferred, issued or appropriated as mentioned in section 93(1)(b), and
(b)the old securities are cancelled.
(5)For the purposes of subsection (2) above the cases in which securities are held under a depositary receipt scheme are those specified (in relation to shares) in section 95(5) above.
(6)The exception provided by this section applies only to the extent that the value of the new securities immediately after their issue does not exceed the value of the old securities immediately before the issue of the new securities.”.
(2)In section 99(10) of that Act (meaning of “chargeable securities”), after “95,” insert “ 95A, ”.
(3)After section 97 of that Act (clearance services: exceptions) insert—
(1)There shall be no charge to tax under section 96 above in respect of the transfer or issue of chargeable securities (“the new securities”) issued by a company in place of existing securities of the same company (“the old securities”) if the following conditions are met.
(2)The first condition is that the old securities are held under a clearance services scheme.
(3)The second condition is that—
(a)there was a charge to tax under section 96 above in respect of the transfer or issue—
(i)of the old securities, or
(ii)of earlier securities in relation to which on a previous application of this section those securities were the new securities,
or there would have been such a charge if that section had been in force; or
(b)there would have been such a charge but for section 97(3) or (4) above.
(4)The third condition is that there is an arrangement under which—
(a)the new securities are transferred or issued as mentioned in section 96(1)(b), and
(b)the old securities are cancelled.
(5)For the purposes of subsection (2) above the cases in which securities are held under a clearance services scheme are those specified (in relation to shares) in section 97(6) above.
(6)The exception provided by this section applies only to the extent that the value of the new securities immediately after their issue does not exceed the value of the old securities immediately before the issue of the new securities.”.
(4)In section 99(10) of that Act (meaning of “chargeable securities”), after “97” insert “ , 97AA ”.
(5)This section applies in relation to securities issued on or after 1st May 1998.
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