Taxation of Chargeable Gains Act 1992 section 169VB

Qualifying shares, potentially qualifying shares and excluded shares

Section 169VB classifies shares held immediately before a disposal into one of three categories — qualifying, potentially qualifying, or excluded — for the purposes of investors' relief.

• A share is a qualifying share if it was subscribed for by the investor, issued on or after 17 March 2016 by an unlisted trading company, held continuously as an ordinary share for at least three years, and the investor (or a connected person) was never a relevant employee of the company during the holding period.
• A share is a potentially qualifying share if it meets all the conditions for a qualifying share except that the three-year minimum holding period has not yet elapsed at the date of disposal — it may qualify for relief on a future disposal.
• A share is an excluded share if it fails to meet the conditions for either a qualifying or a potentially qualifying share — for example, because it was acquired before the relief commenced — and can never attract investors' relief.
• For shares issued between 17 March 2016 and 5 April 2016, the minimum holding period is extended beyond three years by the number of days between the issue date and 5 April 2016, meaning no claim could be made for a disposal before 6 April 2019.