Finance Act 1986
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Change 1
75 Acquisitions: reliefs.
(1) This section applies where a company (the acquiring company) acquires the whole or part of an undertaking of another company (the target company) in pursuance of a scheme for the reconstruction of the target company. (2) If the first and second conditions (as defined below) are fulfilled, stamp duty under Part I of Schedule 13 to the Finance Act 1999 (conveyance or transfer on sale)shall not be chargeable on an instrument executed for the purposes of or in connection with the transfer of the undertaking or part. (3) An instrument on which stamp duty is not chargeable by virtue only of subsection (2) above shall not be taken to be duly stamped unless it is stamped with the duty to which it would be liable but for that subsection or it has, in accordance with section 12 of the Stamp Act 1891, been stamped with a particular stamp denoting that it is not chargeable with any duty. (4) The first condition is ... that the consideration for the acquisition— (a) consists of or includes the issue of non-redeemable shares in the acquiring company to all the shareholders of the target company; (b) includes nothing else (if anything) but the assumption or discharge by the acquiring company of liabilities of the target company. In paragraph (a) above, “non-redeemable shares” means shares which are not redeemable shares. (5) The second condition is that— (a) the acquisition is effected for bona fide commercial reasons and does not form part of a scheme or arrangement of which the main purpose, or one of the main purposes, is avoidance of liability to stamp duty, income tax, corporation tax or capital gains tax, (b) after the acquisition has been made, each shareholder of each of the companies is a shareholder of the other, and (c) after the acquisition has been made, the proportion of shares of one of the companies held by any shareholder is the same , or as nearly as may be the same, as the proportion of shares of the other company held by that shareholder. (5A) If immediately before the acquisition the target company or the acquiring company holds any of its own shares, the shares are to be treated for the purposes of subsections (4) and (5) as having been cancelled before the acquisition (and, accordingly, the company is to be treated as if it were not a shareholder of itself). (6) This section applies to any instrument which is executed after 24th March 1986 unless it is executed in pursuance of an unconditional contract made on or before 18th March 1986. (7) This section shall be deemed to have come into force on 25th March 1986.
75 Acquisitions: reliefs.
(1) This section applies where a company (the acquiring company) acquires the whole or part of an undertaking of another company (the target company) in pursuance of a scheme for the reconstruction of the target company. (2) If the first and second conditions (as defined below) are fulfilled, stamp duty under Part I of Schedule 13 to the Finance Act 1999 (conveyance or transfer on sale)shall not be chargeable on an instrument executed for the purposes of or in connection with the transfer of the undertaking or part. (3) An instrument on which stamp duty is not chargeable by virtue only of subsection (2) above shall not be taken to be duly stamped unless it is stamped with the duty to which it would be liable but for that subsection or it has, in accordance with section 12 of the Stamp Act 1891, been stamped with a particular stamp denoting that it is not chargeable with any duty. (4) The first condition is ... that the consideration for the acquisition— (a) consists of or includes the issue of non-redeemable shares in the acquiring company to all the shareholders of the target company; (b) includes nothing else (if anything) but the assumption or discharge by the acquiring company of liabilities of the target company. In paragraph (a) above, “non-redeemable shares” means shares which are not redeemable shares. (5) The second condition is that— (a) the acquisition is effected for bona fide commercial reasons and does not form part of a scheme or arrangement of which the main purpose, or one of the main purposes, is avoidance of liability to stamp duty, income tax, corporation tax or capital gains tax, (b) after the acquisition has been made, each shareholder of each of the companies is a shareholder of the other, and (c) after the acquisition has been made, the proportion of shares of one of the companies held by any shareholder is the same , or as nearly as may be the same, as the proportion of shares of the other company held by that shareholder. (5A) If immediately before the acquisition the target company or the acquiring company holds any of its own shares, the shares are to be treated for the purposes of subsections (4) and (5) as having been cancelled before the acquisition (and, accordingly, the company is to be treated as if it were not a shareholder of itself). (6) This section applies to any instrument which is executed after 24th March 1986 unless it is executed in pursuance of an unconditional contract made on or before 18th March 1986. (7) This section shall be deemed to have come into force on 25th March 1986.
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