Particular topics: transactions in securities: definitions: securities and transaction in securities
This is an extended definition in ITA/S713. It includes shares and stock plus any interest held as a member of a company including a company not limited by shares, such as a company limited by guarantee or an unlimited company. This list is not exhaustive.
Transactions in securities
These are transactions, of whatever description, relating to securities (ITA07/S684) including (but not limited to)
- the purchase, sale or exchange of securities,
- the issue, or securing the issue, of new securities,
- applying or subscribing for new securities, and
- altering or securing the alteration of rights attached to securities.
An officer who is aware of a transaction in securities “of whatever nature” will need to consider whether the legislation applies. Clearance & Counteraction Team will advise. See CTM36860.
The courts have held that the following are transactions in securities:
|Redemption of a security||IRC v Parker (1966) 43TC396|
|Alteration of rights attaching to a security (in this case through liquidation agreement)||IRC v Joiner (1975) 50TC499|
|Loans made by a company to individuals who subsequently acquired the company||Williams v IRC (1979) 54TC257|
The payment of a dividend is not a transaction in securities. In IRC v Laird  UKHL 54 Lord Millett explained that “the distribution of the undistributed profits of a company to the shareholders entitled thereto merely gives effect to the rights attaching to the shares”.