Q&As

On a share buyback carried out by a UK company, one would usually expect any proceeds received by a UK shareholder in excess of the subscription price (broadly speaking) to be taxed as a dividend distribution. Does the same position apply to the proceeds received by a UK shareholder on a buyback carried out by an overseas company?

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Published on LexisPSL on 09/05/2019

The following Tax Q&A provides comprehensive and up to date legal information covering:

  • On a share buyback carried out by a UK company, one would usually expect any proceeds received by a UK shareholder in excess of the subscription price (broadly speaking) to be taxed as a dividend distribution. Does the same position apply to the proceeds received by a UK shareholder on a buyback carried out by an overseas company?

The tax treatment of a UK taxpayer on a repurchase of shares by an overseas entity is not necessarily the same as that which applies where proceeds are received on a UK company share buyback complying with company law requirements. This Q&A assumes that the shares will be repurchased by the overseas entity directly, rather than through a bank intermediary.

In particular, the tax treatment will depend on:

  1. whether the UK taxpayer is subject to co

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