19A Early redemption: special rules

1

Sub-paragraph (2) below applies where—

a

a security is issued on or after 13th November 1991,

b

it would be a deep gain security apart from paragraph 1(3B) or (3E) above,

c

it is redeemed before maturity, and

d

immediately before redemption it was held by a person connected with the person who issued it.

2

As regards the redemption, paragraphs 5 to 19 above shall have effect as if—

a

the security were a deep gain security, and

b

it had been acquired as such (whatever the time it was acquired).

3

Sub-paragraph (4) below applies where—

a

the conditions set out in sub-paragraph (1)(a) to (c) above are fulfilled,

b

the security was transferred in the period ending with redemption and beginning with the day falling one year before the day of redemption, and

c

the transfer was by a person connected with the person who issued the security.

4

As regards the transfer, paragraphs 5 to 19 above shall have effect as if—

a

the security were a deep gain security, and

b

it had been acquired as such (whatever the time it was acquired).

5

Section 839 of the Taxes Act 1988 (connected persons) shall apply for the purposes of this paragraph.