Income Tax Act 2007 section 257QP

Repayment of authorised minimum within 12 months

Section 257QP provides an exception from the social investment relief withdrawal rules where a public company redeems its initial minimum share capital within 12 months of issue.

• Applies where a company issues shares equal to the authorised minimum share capital required under the Companies Act 2006 for a public company to trade
• The Registrar of Companies must have issued the company with a trading certificate under section 761 of the Companies Act 2006
• If those shares are redeemed within 12 months of issue, the normal social investment relief withdrawal rules in section 257QJ(2) do not apply
• This recognises the common practice of establishing a public company with redeemable shares that are later redeemed when the company is acquired by its permanent owners