Share sales - pre budget report

Share sales - pre budget report

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Normally when shares are sold in exchange for cash and shares in the acquiring company, the gain arising on the new shares is deferred. The new shares stand in the shoes of the old shares and take on the original base cost details. The cash will be taxed up front and the gain arises on the new shares when they are disposed of.

As taper relief will no longer be available from April 2008, it would be detrimental to have the future gain on shares taxed at 18% rather than the current 10% rate (if business asset taper relief is applicable).

Do you have to apply the share for share rules or are there any "get out" clauses?
PF

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