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Home / Simons-Taxes /Corporate tax /Part D6 Company reconstruction and profit extraction /Division D6.2 Reorganisation of share capital /Issue of share capital / D6.223 Bonus issue—disposal—apportionment of base cost where same class of shares

D6.223 Bonus issue—disposal—apportionment of base cost where same class of shares

Corporate tax

Where the new holding is of shares of the same class as the original shares the acquisition cost is simply apportioned over the new holding.

These apportionment rules apply equally to shares acquired by way of a rights issue. On a rights issue, the amount paid for taking up the issue is treated as having been given for the original shares and is added to the cost of the original shares. See D6.232 for further details.

Example

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E4.507S Operation of the charge on securities with artificially enhanced market value

B6.749 ATED—property developers

B4.130 Summary of OECD guidelines on arm's length principle

I3.367 Fall in value relief—changes in interests in land

I3.750 POAT—introduction to existing arrangements

B5.123 BPS—negligible value claims

C2.501A Compensation and capital gains tax—overview

E4.622 Vans—main rules

I4.562 Sales and mortgages of reversionary interests

C2.902 Wasting assets—wasting of allowable expenditure

B2.315 The concept of wholly and exclusively

D6.618 Capital treatment on a purchase of own shares—HMRC advance clearance and reporting obligations

E4.1318 Special mixed fund rules

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I7.120A BPR and excepted assets

C3.305 Rollover relief—time limit for acquisition of replacement assets

I5.1122 More than one settlor (income tax and CGT)

E7.234 Other types of lifetime benefit lump sum

D6.233 Rights issue—sale of rights nil paid