Taxation of Chargeable Gains Act 1992 section 169VO

The appropriate number

Section 169VO sets out how to calculate the "appropriate number" of shares in a new holding that qualify for investors' relief following a share reorganisation where no consideration is given.

• After a share reorganisation, the new holding must be apportioned to identify which shares retain their qualifying status for investors' relief.
• The appropriate number is found by multiplying the total shares in the new holding by the fraction A / B, where A is the number of original qualifying shares and B is the total number of original shares.
• To count as qualifying (A), original shares must have been subscribed for by the qualifying person, issued on the relevant date, and continuously held throughout the required period.
• This calculation preserves the same proportion of qualifying shares in the new holding as existed in the original holding before the reorganisation.