Commentary

Section 40 Impact of Section 1000 of the Corporation Tax Act 2010—distributions and dividends

COMPANIES vol 11 acquisitions, mergers, demergers
| Commentary

Section 40 Impact of Section 1000 of the Corporation Tax Act 2010—distributions and dividends

| Commentary

2: ISSUE OF SHARES DEEMED TO BE A DISTRIBUTION

40 Impact of Section 1000 of the Corporation Tax Act 2010—distributions and dividends

As a general rule, it will be preferable for a profit to be taxed as a capital gain (currently taxed at 10–20% on shares for individuals, and at the corporate tax rate for corporations) rather than income (at 10%, 20% and 45% for individuals). However, in some cases the tax regime treats the profit as income. For instance, many company reorganisations involve the transfer of assets by a target company to an acquiring company in consideration of the issue

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