Commentary

C3.1918 Recovery of rollover relief for shares transferred to QUESTs

Capital gains tax
Capital gains tax | Commentary

C3.1918 Recovery of rollover relief for shares transferred to QUESTs

Capital gains tax | Commentary

C3.1918 Recovery of rollover relief for shares transferred to QUESTs

Any rollover relief given under TCGA 1992, s 229 (for disposals made before 6 April 2001; see C3.1917) may be withdrawn if a chargeable event occurs after the date of the disposal of the shares to the share ownership trust.

The relief given may be recovered where the claimant (or a person connected with him) still owns beneficially any of the replacement assets acquired on the disposal of the shares1, or where gains accruing on the disposal of those assets have been rolled over into replacement business assets2. However, the relief will not be withdrawn if the claimant was an individual who died before the chargeable event occurs or the trustees of a settlement which ceased to exist before the chargeable event occurs3.

Except where the replacement assets are shares which have been exchanged for qualifying corporate bonds, the provisions for recovering relief do not take account of any fall in value in the replacement assets.

Chargeable events

Any of the following breaches of the rules governing qualifying employee share ownership trusts is a chargeable event which may result in the withdrawal of rollover relief given on disposals of shares to the trust4:

  1.  

    (a)     a transfer of securities by the trustees of the share ownership trust other than a transfer to beneficiaries or a transfer at not less than market value to the trustees of an approved profit sharing scheme and other than a transfer by way of exchange for other shares or

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