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HMRC internal manual

Venture Capital Schemes Manual

CVS: loss relief: tax avoidance


Loss relief is not available where the disposal occurs in consequence of a company reconstruction or amalgamation and the conditions in TCGA92/S137 (1), see CG52621 to CG52624, are not met (cases where the transactions are not effected for genuine commercial reasons and with no tax avoidance purpose).

Where a loss has been increased because the value of the shares has been reduced in circumstances where the qualifying investing company, or another person, receives any benefit (and not just a tax-free benefit), the amount of loss relief available is correspondingly reduced. The value-shifting rules provided by TCGA92/S30 are modified by FA00/SCH15/PARA71 (3) to achieve this in relation to loss relief.