PART XIII MISCELLANEOUS SPECIAL PROVISIONS
F1Chapter 5AShare loss relief
Relief for losses on unquoted shares in trading companies
C1575 Exclusion of relief under section 573 or 574 in certain cases.
M11
Sections 573 and 574 do not apply unless the disposal is—
a
by way of a bargain made at arm’s length for full consideration; or
b
by way of a distribution in the course of dissolving or winding up the company; or
F5ba
a disposal within section 24(1) of the 1992 Act (entire loss, destruction, dissipation or extinction of asset); or
c
a deemed disposal under section F224(2) of the 1992 Act (claim that value of asset has become negligible).
2
Where a person disposes of shares (“the new shares”) which by virtue of section F3127 of the 1992 Act (reorganisation etc. treated as not involving disposal) are identified with other shares (“the old shares”) previously held by him, relief shall not be given under section 573 or 574 on the disposal of the new shares unless—
a
relief under section 573 or 574 could (or if this section had been in force could) have been given on a disposal of the old shares if he had incurred an allowable loss in disposing of them as mentioned in subsection (1)(a) above on the occasion of the disposal that would have occurred but for section F3127 of the 1992 Act; or
b
he gave new consideration for the new shares;
but in a case within paragraph (b) above the amount of relief under section 573 or 574 on the disposal of the new shares shall not exceed the amount or value of the new consideration taken into account as a deduction in computing the loss incurred on their disposal.
3
Where the shares are the subject of an exchange or arrangement of the kind mentioned in section F4135 or 136 of the 1992 Act (company reconstructions etc.) which by reason of section F4137 of that Act involves a disposal of the shares, section 573 or 574 shall not apply to any allowable loss incurred on the disposal.
Pt. 13 Ch. 5A created (6.4.2007 with effect in accordance with s. 1034(1) of the affecting Act) by virtue of Income Tax Act 2007 (c. 3), Sch. 1 para. 117(3) (with Sch. 2)