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HMRC internal manual

Capital Gains Manual

From
HM Revenue & Customs
Updated
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Company reconstructions: TCGA92/S137 prevents TCGA92/S136 from applying

TCGA92/S136, TCGA92/S137

If the anti-avoidance provisions of TCGA92/S137 prevent TCGA92/S136 from applying the reconstruction or amalgamation should be treated as a disposal of the original shares or a disposal of an interest in those shares.

  • If the transaction is a bargain made at arm’s length the disposal proceeds will be the value in money’s worth of the new shares or securities.
  • If the transaction was not a bargain made at arm’s length the disposal proceeds will be the market value of the original shares involved in the reconstruction or amalgamation.

Any appeal or objection to this treatment should be referred to the clearance team in Counter-Avoidance Directorate with the files for the shareholder and the company if available.