Part VII Other property, businesses, investments etc.
F1Investments in social enterprises
255EReorganisations involving shares to which SI relief is attributable
1
Subsection (2) applies if an individual holds shares which form part of the ordinary share capital of a company and include shares of more than one of the following kinds—
a
shares to which SI relief is attributable and to which subsection (3) applies,
b
shares to which SI relief is attributable and to which subsection (3) does not apply, and
c
shares to which SI relief is not attributable and to which subsection (3) does not apply.
2
If there is a reorganisation within the meaning of section 126 affecting the shares listed in subsection (1), section 127 applies separately to those shares so that shares of each kind are treated as a separate holding of original shares and identified with a separate new holding.
3
This subsection applies to any shares if—
a
expenditure on the shares has been set under Schedule 8B to this Act against the whole or part of any gain, and
b
in relation to the shares there has been no chargeable event for the purposes of that Schedule.
4
If—
a
an individual holds shares (“the existing holding”) which form part of the ordinary share capital of a company,
b
there is, by virtue of any such allotment for payment as is mentioned in section 126(2)(a), a reorganisation affecting the existing holding, and
c
immediately following the reorganisation, SI relief is attributable to the existing holding or the allotted shares,
sections 127 to 130 do not apply in relation to the existing holding.
5
Subject to subsection (6), sections 135 and 136 do not apply in respect of shares to which SI relief is attributable.
6
Subsection (5) does not have effect to disapply section 135 or 136 in a case where the original shares are shares to which SI relief is attributable if—
a
the new holding consists of new ordinary shares which meet conditions A and B of section 257L of ITA 2007,
b
the new shares are issued after the end of three years beginning with the day on which the original shares were acquired,
c
before issuing the new shares, the company had issued shares which met conditions A and B of section 257L of ITA 2007, and
d
the company issued a compliance certificate in relation to those earlier shares for the purposes of section 257PA(1) of ITA 2007 and in accordance with sections 257PB and 257PC of ITA 2007.
7
In subsection (6) “new holding” is to be construed in accordance with sections 126, 127, 135 and 136.
8
In this section—
“ordinary share capital” has the meaning given in section 989 of ITA 2007;
“ordinary shares”, in relation to a company, means shares forming part of its ordinary share capital.
Ss. 255A-255E and cross-heading inserted (17.7.2014) by Finance Act 2014 (c. 26), Sch. 12 para. 2