Commentary

D6.202 Scheme of reconstruction—scope

Corporate tax
Corporate tax | Commentary

D6.202 Scheme of reconstruction—scope

Corporate tax | Commentary

Scheme of reconstruction involving an issue of securities

D6.202 Scheme of reconstruction—scope

The basic premise behind a scheme of reconstruction is that where the original shareholders keep an interest in the original business then, subject to conditions, they will not be treated as having disposed of their original shares. Many schemes of reconstruction will be effected using specific provisions of the Companies Act 2006 or the Insolvency Act 1986. But it is not essential to use these. The relieving provisions1 are capable of applying to any scheme of reconstruction that meets the required definition2.

A scheme of reconstruction involving an issue of securities will, subject to meeting certain conditions (see D6.203), fall within the share reorganisation rules (D6.101–D6.103) and therefore

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