Taxation of Chargeable Gains Act 1992 Schedule 5B paragraph 14AA

Insignificant repayments disregarded for purposes of paragraph 14

Section 14AA provides that certain small or insignificant repayments made by a company (or its subsidiary) can be disregarded when determining whether value has been received by other persons under the Enterprise Investment Scheme re-investment relief rules.

• A repayment can be ignored if the greater of the market value of the shares involved or the amount received is insignificant compared to the market value of the company's remaining issued share capital after the event
• For the purposes of this test, the shares to which the repayment relates are assumed to have been cancelled at the time the repayment is made
• The term "repayment" covers any repayment, redemption, repurchase or payment described in paragraph 14(1)
• The insignificance exception does not apply where, at any time from one year before the shares were issued up to the end of the issue date, arrangements existed for such a repayment or for anyone to be entitled to one during the period of restriction