Link Report

8A Any reference in subparagraph (d) of paragraph 8 to shares shall be construed as including a reference to shares which were issued to the trustees of the employee share ownership trust referred to in that subparagraph as a result of a reorganisation or reduction of share capital (in accordance with section 584) which occurred subsequent to the exchange referred to in that subparagraph and which shares represent—

(a) if they are securities acquired by the trustees as a result of a reorganisation or reduction of share capital , and the original shares the securities represent are shares in the founding company (construing “reorganisation or reduction of share capital” and “original shares” in accordance with section 584), or

(a) if the trustees become entitled to securities as a result of a reorganisation or reduction of share capital, they shall be treated as having acquired them when they became entitled to the original shares which those securities represent (construing “reorganisation or reduction of share capital” and “original shares” in accordance with section 584);

(a) one holding of shares is treated by virtue of section 584 as the same asset as another, or

(1) In this paragraph “original shares” and “new holding” shall be construed in accordance with sections 584, 586 and 587.

in circumstances such that, under section 584 as that section applies by virtue of section 586 or 587, the original shares and the new holding are treated as the same asset.

(I) accept an offer for the shares (in this clause referred to as the “original shares”) if the acceptance or agreement would result in a new holding (within the meaning of section 584) being equated with the original shares for the purposes of capital gains tax,

(10) Where for the purposes of capital gains tax the time when a person acquired shares would be determined under section 584, 585, 586, 587 or 600, then, unless the person is to be treated under section 584(4) as giving or becoming liable to give any consideration, other than the old holding, for the acquisition of those shares, it shall be determined in the same way for the purposes of this section.

(10) Where for the purposes of capital gains tax the time when a person acquired shares would be determined under section 584, 585, 586, 587 or 600, then, unless the person is to be treated under section 584(4) as giving or becoming liable to give any consideration, other than the old holding, for the acquisition of those shares, it shall be determined in the same way for the purposes of this section.

(II) section 584 is applied or, but for section 626B, would be applied to the exchange by section 586, and

(6) Where there occurs in relation to any of the eligible shares of an eligible employee (in this subsection referred to as “the original holding”) a transaction which results in a new holding (within the meaning of section 584) being equated with the original holding for the purposes of capital gains tax, then, for the purposes of subsection (3)—

(3) Where an individual holds shares in a company and the relief has been given in respect of some of the shares but not others, then, if there is a reorganisation (within the meaning of section 584) affecting those shares, section 584(3) shall apply separately to the shares in respect of which the relief has been given and to the other shares (so that the shares of each kind shall be treated as a separate holding of original shares and identified with a separate new holding).

(3) Where an individual holds shares in a company and the relief has been given in respect of some of the shares but not others, then, if there is a reorganisation (within the meaning of section 584) affecting those shares, section 584(3) shall apply separately to the shares in respect of which the relief has been given and to the other shares (so that the shares of each kind shall be treated as a separate holding of original shares and identified with a separate new holding).

(5) Where shares in respect of which relief was given have by virtue of any such allotment mentioned in subsection (1) of section 584 (not being an allotment for payment) been treated under subsection (3) of that section as the same asset as a new holding, then—

(iii) securities issued to those trustees as a result of a reorganisation or reduction of share capital (in accordance with section 584) which occurred subsequent to the exchange referred to in subparagraph (i) and which securities represent the securities issued in that exchange and the similar securities (if any) referred to in subparagraph (ii), or

(a) directing the trustees to accept an offer for any of his or her shares (in this paragraph referred to as “the original shares”) if the acceptance or agreement will result in a new holding (within the meaning of section 584) being equated with the original shares for the purposes of capital gains tax,

(2) This section shall apply where there occurs in relation to any of a participant’s shares (in this section referred to as “the original holding”) a transaction (in this section referred to as a “company reconstruction”) which results in a new holding (within the meaning of section 584) being equated with the original holding for the purposes of capital gains tax.

(7) In relation to a new holding, any reference in this section to shares includes securities and rights of any description which form part of the new holding for the purposes of section 584.

(b) in a case where section 584, 586 or 587 applies, the shares received in exchange for the shares so acquired,

(b) Where a quoted option to subscribe for shares in a company is dealt in within 3 months after the taking effect, with respect to the company granting the option, of any reorganisation, reduction, conversion or amalgamation to which section 584, 585, 586 or 587 applies (or within such longer period as the Revenue Commissioners may by notice in writing allow), the option shall for the purposes of section 584, 585, 586 or 587 be regarded as the shares which could be acquired by exercising the option, and section 548(3) shall apply for determining its market value.

(b) Where a quoted option to subscribe for shares in a company is dealt in within 3 months after the taking effect, with respect to the company granting the option, of any reorganisation, reduction, conversion or amalgamation to which section 584, 585, 586 or 587 applies (or within such longer period as the Revenue Commissioners may by notice in writing allow), the option shall for the purposes of section 584, 585, 586 or 587 be regarded as the shares which could be acquired by exercising the option, and section 548(3) shall apply for determining its market value.

(a) on a reorganisation referred to in section 584(2) or in pursuance of the debenture’s allotment on any such reorganisation,

(b) Notwithstanding subsection (1) and section 584(3), where a company, otherwise than by means of a bargain made at arm’s length, allots shares in the company (in this subsection referred to as “the new shares”) to a person connected with the company, the consideration which the person gives or becomes liable to give for the new shares shall for the purposes of the Capital Gains Tax Acts be deemed to be an amount (including a nil amount) equal to the lesser of—

(2) Where a person receives or becomes entitled to receive in respect of shares in a company any capital distribution from the company (other than a new holding within the meaning of section 584), such person shall be treated for the purposes of the Capital Gains Tax Acts as if such person had in consideration of that capital distribution disposed of an interest in the shares.

(2) Section 584 shall apply with any necessary modifications in relation to the conversion of securities as it applies in relation to the reorganisation or reduction of a company’s share capital.

(1) Subject to section 587, where a company issues shares or debentures to a person in exchange for shares in or debentures of another company, section 584 shall apply with any necessary modifications as if the 2 companies were the same company and the exchange were a reorganisation of its share capital.

(3) Subsection (2) shall apply in relation to a company which has no share capital as if references to shares in or debentures of a company included references to any interests in the company possessed by members of the company, and sections 584 and 586 shall apply accordingly.

(4) Where in connection with the arrangement shares in the successor company are issued to a member of the assurance company concerned, and such shares are treated under section 587 as having been exchanged by the member for the interest in the company possessed by the member, those shares shall, notwithstanding section 584, be regarded for the purposes of section 552(1)—

(iii) in determining whether the treatment provided for in subsection (2) applies, the question of whether there is a disposal shall be determined without regard to section 584 or that section as applied by any other section: and, to the extent to which an exemption under subsection (2) does apply in relation to a disposal, section 584 shall not apply in relation to the disposal,

(iii) in determining whether the treatment provided for in subsection (2) applies, the question of whether there is a disposal shall be determined without regard to section 584 or that section as applied by any other section: and, to the extent to which an exemption under subsection (2) does apply in relation to a disposal, section 584 shall not apply in relation to the disposal,

(2)(a) Subject to paragraph (b), section 584 shall apply with any necessary modification in relation to a reorganisation or reduction of units in any unit trust scheme registered under the Unit Trusts Act, 1972, or authorised under the European Communities (Undertakings for Collective Investment in Transferable Securities) Regulations, 1989 (S.I. No. 78 of 1989), as if (except as respects subsection (7) of that section)—

(b) Where but for this paragraph this section would apply to any reorganisation or reduction of units in a unit trust scheme in a year of assessment so that units which are deemed not to be chargeable assets for that year for the purposes of the Capital Gains Tax Acts would be treated as “original shares” or a “new holding” within the meaning of section 584, that section shall not apply to that reorganisation or reduction of units in the unit trust scheme.

(3) The references in subsection (2) to section 584 do not include references to that section as applied by section 585 or 586.

and, for the purpose of determining whether the asset disposed of is within paragraph (b), subsection (3) of section 584 shall apply as it applies for the purposes of the Capital Gains Tax Acts.

(5) An event which apart from section 584(3) would constitute a disposal of an asset shall constitute such a disposal for the purpose of determining whether by virtue of subsection (3) there is a disposal to which this Chapter applies.

(6) The reference in subsection (5) to section 584(3) shall be deemed to include a reference to that section as applied by section 586 or 733 but not as applied by section 585.

(a) on which the interest acquired constituted the new holding for the purposes of section 584, including that section as applied by section 585 or 586, and

(b) on which no consideration fell to be given for the interest acquired, other than the interest which constituted the original shares for the purposes of section 584, including that section as so applied.

(6) Where the disposal to which this Chapter applies constitutes such a disposal by virtue of section 741(6) or 742(5), the Capital Gains Tax Acts shall apply as if an amount equal to the offshore income gain to which the disposal gives rise were given (by the person making the exchange concerned) as consideration for the new holding (within the meaning of section 584(1)).

“new holding”, in relation to original shares, and “original shares” have, respectively, the same meanings as in section 584(1).

(3) This section applies to any transaction, being a disposal of original shares which, if the original shares were not such as are mentioned in subsection (2) would result in the disposal not being treated as a disposal by virtue of sections 584 to 587; but does not apply to any transaction in relation to which section 751B applies.

(6) Subsections (4) and (5) shall have effect with the necessary modifications in relation to any computation made for the purposes of section 707(4) in a case where the original shares held by the company concerned and the new holding are treated as the same asset by virtue of any of sections 584 to 587.

(3) An event which, apart from section 584(3) as applied by section 586 or 587, would constitute the disposal of an asset giving rise to a chargeable gain or an allowable loss under the Capital Gains Tax Acts and the Corporation Tax Acts shall for the purposes of this section constitute such a disposal.

(5)(a) An event which, apart from section 584(3) as applied by section 586 or 587, would constitute the disposal of an asset shall for the purposes of this section constitute such a disposal.

(b) An event which, apart from section 584(3) as applied by section 586 or 587, would constitute the acquisition of an asset shall for the purposes of this section constitute such an acquisition.

(e) shares, other than shares quoted on a stock exchange, to which section 584 applies, whether by virtue of that section or any other section, so that, as respects a person disposing of those shares, they are treated as the same shares as shares specified in paragraph (d), acquired as the shares so specified were acquired, and