Commentary

I4.324 Alteration of capital or rights of close company shares or securities

IHT, trusts and estates

I4.324 Alteration of capital or rights of close company shares or securities

I4.324 Alteration of capital or rights of close company shares or securities

Where the relevant property (see I4.321) consists of shares in or securities of a close company1, the relief is not available if at any time between the death and the qualifying sale (see I4.323) the value of the shares or securities is reduced by more than 5% as a result of an alteration in the company's share or loan capital or in any rights attaching to shares in or securities of the company.

This provision, obviously, is a necessary anti-avoidance measure. 'Alteration' includes extinguishment2.

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