Taxation of Chargeable Gains Act 1992 section 169VQ

Exchange of shares for those in another company

Section 169VQ explains how the investors' relief reorganisation rules apply when one company acquires the shares of another company through a share-for-share exchange.

• The section applies where company B issues its own shares in exchange for shares in company A, under the share-for-share exchange provisions of section 135
• For the purposes of the investors' relief reorganisation rules, companies A and B are treated as if they were the same company
• The share exchange is treated as though it were a reorganisation of that single company's share capital, preserving the status of the shares for investors' relief purposes
• This ensures that the classification of shares as qualifying, potentially qualifying, or excluded shares carries through the exchange without disruption