Commentary

I6.113 Alteration in capital example

IHT, trusts and estates

I6.113 Alteration in capital example

I6.113 Alteration in capital example

Example—simple alteration in securities

As at 31 July 2018 the share capital of A Ltd, an active trading company, was held as follows:

Arthur6,000
Bella4,000
10,000£1 ordinary shares

Arthur's shareholding was valued at £15 per share and Bella's at £6 per share.

Arthur had owned his shares for more than two years, but Bella had owned half of hers for more than two years and the other half for only one year.

On 1 August 2018, A Ltd issued 20,000 £1 ordinary shares at par to Constance. Thereafter Arthur's shareholding was valued at £5

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