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HMRC internal manual

Capital Gains Manual

HM Revenue & Customs
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Co.purchases own shares: covered by ICTA88 S219: computation


Taxpayers may now argue that the relevant conditions in ICTA88/S219 - ICTA88/S229 are not satisfied and that the purchase should be treated as a distribution. Indeed taxpayers can apply for advance clearance under ICTA88/S225 (1)(b) that the Board of Inland Revenue is satisfied ICTA88/S219 will not apply.

When dealing with a purchase of own shares by an unquoted trading company you should first check whether Advance Corporation Tax has been accounted for. If it has the purchase has been treated as a distribution. Where necessary make a report to Business Tax (Purchase of Own Shares), 100 Parliament Street, London under CT1751 penultimate sub paragraph.