Commentary

I3.119 Alteration of close company as disposition

IHT, trusts and estates

I3.119 Alteration of close company as disposition

I3.119 Alteration of close company as disposition

An alteration in a close company's capital or in the rights attaching to it could be used as a vehicle for transferring value without any property changing hands.

This is brought within the charge to IHT by the provision that any alteration in a close company's (see I6.102) unquoted share or loan capital and any alteration to rights attaching to unquoted shares in or debentures of a close company is treated as a disposition made by the participators at the time of the alteration1. Alteration, for this purpose, includes extinguishment2.

The provision thus

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