Cash might be caught but investment properties are not. They are part of the company's business. Options for cash include Vile's suggestion and investing the cash in something suitable.
Have you considered the restrictions to business asset holdover relief in Part II of Sch 7?
Based on what information you have given I am inclined to the view that BPR remains available possibly without restriction. Why do you consider it to be unavailable?
If you do it for cash this is classic transactions in securities stuff. In theory you can escape with a good enough commercial (apart from saving tax) motive. But good luck in finding one good enough to get past the clearance team!
Depends on your definition of disposition in IHTA 1984 s3. By agreeing to the issue of shares he has caused value to flow out of his shares. Tried goggling the definition and it included "the way in which something is placed or arranged, especially in relation to other things.
"the plan shows the disposition of the rooms""
So I think it is caught.
I am surprised that you can say that the shares qualify for CGT holdover relief (or do you mean s260 relief?) and not for IHT BPR. My focus would be to ensure that the shares qualified for BPR and then give them away.
A degrouping charge should not apply if co B is struck off. It has been suggested that co A "leaves" the group in this situation because there is no longer a group. HMRC told the ICAEW a number of years ago that this is not their view. But you will probably find that different tax counsel have different views on this one! Obviously, if you want to play safe, keeping co B as a dormant subsidiary is one way. Another way is to create a new dormant subsidiary before striking off co B. Whether this is a better solution depends on the reasons for wanting to be rid of co B.
I am currently going to two local NHS hospitals for different problems that may, or may not be connected. You will be impressed to know that the doctor in one hospital was able to read the notes of the other on his computer screen! Also, when taking blood pressure tests, etc., the nurses now use mobile phones to input the results. Of course this is done manually - one day the machines recording the readings will be able to transmit the information direct - but we cannot expect too much!!
You have in mind the rollover rules in TCGA 1992 s135. For this to apply the acquiring company must issue shares or debentures as part of the consideration. I struggle to see how distribution rights fall within this definition. So, in my view, the sale is for £200k plus the value of the rights. This is probably the £1.5m you mention.
Co A acquires Mr A's shares in co B in exchange for an issue of new shares in co A. Subject to tax clearance (which should be forthcoming but remember to mention the planned hive up), tax-free transaction and you now have the desired group to allow a tax-free hive up.
My answers
Cash might be caught but investment properties are not. They are part of the company's business. Options for cash include Vile's suggestion and investing the cash in something suitable.
Have you considered the restrictions to business asset holdover relief in Part II of Sch 7?
Based on what information you have given I am inclined to the view that BPR remains available possibly without restriction. Why do you consider it to be unavailable?
If you do it for cash this is classic transactions in securities stuff. In theory you can escape with a good enough commercial (apart from saving tax) motive. But good luck in finding one good enough to get past the clearance team!
Depends on your definition of disposition in IHTA 1984 s3. By agreeing to the issue of shares he has caused value to flow out of his shares. Tried goggling the definition and it included "the way in which something is placed or arranged, especially in relation to other things.
"the plan shows the disposition of the rooms""
So I think it is caught.
I am surprised that you can say that the shares qualify for CGT holdover relief (or do you mean s260 relief?) and not for IHT BPR. My focus would be to ensure that the shares qualified for BPR and then give them away.
You could do what you suggest and transfer one trade to Holdco. However, do you want the trades in two companies that are not in a group?
A degrouping charge should not apply if co B is struck off. It has been suggested that co A "leaves" the group in this situation because there is no longer a group. HMRC told the ICAEW a number of years ago that this is not their view. But you will probably find that different tax counsel have different views on this one! Obviously, if you want to play safe, keeping co B as a dormant subsidiary is one way. Another way is to create a new dormant subsidiary before striking off co B. Whether this is a better solution depends on the reasons for wanting to be rid of co B.
I am currently going to two local NHS hospitals for different problems that may, or may not be connected. You will be impressed to know that the doctor in one hospital was able to read the notes of the other on his computer screen! Also, when taking blood pressure tests, etc., the nurses now use mobile phones to input the results. Of course this is done manually - one day the machines recording the readings will be able to transmit the information direct - but we cannot expect too much!!
You have in mind the rollover rules in TCGA 1992 s135. For this to apply the acquiring company must issue shares or debentures as part of the consideration. I struggle to see how distribution rights fall within this definition. So, in my view, the sale is for £200k plus the value of the rights. This is probably the £1.5m you mention.
Co A acquires Mr A's shares in co B in exchange for an issue of new shares in co A. Subject to tax clearance (which should be forthcoming but remember to mention the planned hive up), tax-free transaction and you now have the desired group to allow a tax-free hive up.
Duplicated