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Paragraph 16 Business asset disposal relief: reorganisations of share capital on or after 30 October 2024 but before 6 April 2026

United Kingdom

(1)

This paragraph applies for the purposes of an election under 169Q of TCGA 1992 in relation to a reorganisation of a company where—

(a)

the reorganisation takes place on or after 30 October 2024 but before 6 April 2026, and

(b)

the election is made on or after 30 October 2024.

(2)

If, when the election is made—

(a)

the company is the relevant individual’s personal company and is either a trading company or the holding company of a trading group, and

(b)

the relevant individual is an officer or employee of the company or (if the company is a member of a trading group) of one or more companies which are members of the trading group,

the disposal of the original shares is to be treated as taking place at the time of the election and not at the time of the reorganisation.

(3)

If, at any time (“the relevant time”) before the making of the election, anything mentioned in sub-paragraph (2)(a) or (b) ceases to be as mentioned there, the disposal of the original shares is to be treated as taking place immediately before the relevant time and not at the time of the reorganisation.

(4)

For the purposes of this paragraph “the relevant individual” means—

(a)

where a claim under section 169M of TCGA 1992 is made jointly by the trustees of a settlement and a qualifying beneficiary, the qualifying beneficiary, and

(b)

where a claim under that section is made by an individual, the individual.

(5)

In this paragraph—

  • “holding company” has the same meaning as in section 165 of TCGA 1992 (see section 165A),

  • “the original shares” has the meaning given by section 126 of TCGA 1992,

  • “reorganisation” has the meaning given by that section, and

  • “trading company” and “trading group” have the meaning given by paragraph 1 of Schedule 7ZA to TCGA 1992.

(6)

References in this paragraph to a reorganisation do not include an exchange of shares or securities which is treated as a reorganisation by virtue of section 135 or 136 of TCGA 1992 (but see instead paragraph 18).

(7)

This paragraph does not apply if both the reorganisation and the election occur in the same tax year.