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HMRC internal manual

Capital Gains Manual

Definitions: security: summary

A very broad definition of ‘securities’ applies for the purposes of the share identification rules at TCGA92/S105. It includes all shares, securities and other fungible assets, except for `relevant securities’ to which separate identification rules apply at TCGA92/S108.

The definition of ‘relevant securities’ in TCGA92/S108 means that most debt-like securities are excluded from the share identification rules at TCGA92/S105 from 1998-99 onwards, except where such securities are disposed of by taxpayers within the charge to Capital Gains Tax. So for Corporation Tax purposes most debt-like securities are ‘relevant securities’ and will be subject to the identification rules in section 108.

A narrower definition of ‘security’ in TCGA92/S132(3)(b) uses the word to mean loan capital as opposed to share capital. Section 132 deals with the conversion of this sort of security into shares or other instruments, see CG55000+. TCGA92/S251 also uses this definition in order to specify a limited range of circumstances in which a debt is not a chargeable asset, see CG53420+.