Taxation of Chargeable Gains Act 1992 section 169VR

New shares issued on scheme of reconstruction

Section 169VR explains how investors' relief rules apply when shareholders receive new shares in a different company as part of a scheme of reconstruction, ensuring continuity of treatment for investors' relief purposes.

• The section applies where a scheme of reconstruction results in company B issuing shares to the existing shareholders of company A, and those shareholders are treated as having exchanged their company A shares for company B shares.
• For the purposes of determining how the new shares are characterised under investors' relief, companies A and B are treated as if they were the same company.
• The share exchange under the reconstruction is treated as though it were simply a reorganisation of a single company's share capital, preserving the investors' relief status of the original shares.
• Any reference to an exchange of shares elsewhere in the investors' relief rules includes anything treated as a share exchange under the reconstruction provisions.