Aletheia Questions

I have questions relating to the CGT treatment when company A takes over company B through a cash and share offer. Company A has provided information for CGT purposes on the market value of its shares on the date of the takeover. (1) I understand from HMRC guidance that CGT must be paid on the cash received as part of the takeover but should this be included in the financial year when the cash was received or should it be included when any overall gain is calculated when the shareholding in company A is sold years later? (2) Based on the information provided for CGT purposes by company A on its market value on the date of the takeover, am I correct in using that value to calculate the base cost of the shares in company A? Thank you

I have questions relating to the CGT treatment of a Rights Issue when new shares are received under a cashless take-up (tail-swallowing) option, where the company sells a sufficient number of nil paid rights so that the balance of the entitlement under the Rights Issue can be taken up using the net proceeds from the sale of the Rights. (1) Should the receipt of the additional shares be treated a capital gain? (2) If yes, should this be considered as a gain in the tax year in which the Rights Issue is held? (3) Or is the gain from receiving the new shares factored in when any gain is calculated when the whole shareholding (including the new shares obtained from the Rights Issue) is sold at a later date? Thank you

I have questions relating to the CGT treatment of a corporate restructuring under which the only option was to receive a slightly smaller number of new shares (37 new for every 40 existing) and cash (62p per share). There was also a small fractional entitlement. (1) Should the cash proceeds from this restructuring be declared as income? (2) Or should the cash proceeds be included as a gain when any gain is calculated when the shares are sold at a later date? Thank you

I have questions relating to the CGT treatment of shares originally obtained at no cost from a building society demutualisation. (1) When calculating any gain or loss on the disposal of so-called “free” shares obtained from a building society demutualisation, is the base cost £nil or is it the value of the shares on the date of the demutualisation? I have seen reference on company websites to the latter approach being adopted, including providing information on the share value on that date, but other sources suggest the former is correct. (2) If the base cost is £nil, am I correct in understanding that the gain is the value of the shares when sold? Many thanks

I have questions relating to the CGT treatment of new shares obtained under a SCRIP Dividend Scheme when, many years later, all of the shares in the company are sold. The SCRIP Dividend Scheme was based on being given one right for each share held and then to hold those rights and receive new shares (according to a conversion ratio set at each of the SCRIP dividend events). In addition to new shares from each event, there would be a small cash proceed from the sale by the company of any fractional entitlements. Each SCRIP event involved the receipt of a small number of shares (below 10) and a fractional entitlement of less than £10 each time. (1) Should the equivalent cash value of the new shares (plus the cash fractional entitlement) be declared as dividend income in the tax year it is received? (2) Or should the cash value of new shares from each SCRIP distribution be treated as a gain and added to the calculation of any gain made when the full shareholding (original plus all the SCRIP shares) is sold? (3) Or is the gain simply the difference between the value of the total shareholding (original plus proceeds from each SCRIP event) when sold, compared to the cost of the original shares? (4) And is there any difference in treatment if the company is overseas (the transactions are conducted in Euros and shareholders in the UK receive dividends etc converted to sterling)? Many thanks

I have questions relating to the CGT treatment of a Rights Issue when, many years later, the shares in the company are sold. (1) Am I correct in understanding that the cash proceeds from the sale of pre-emptive subscription rights (the option to buy new shares was not given) should be treated as a disposal in the relevant tax year when the rights issue was made? And that no CGT would be due if the small proceeds are within the CGT allowance for that year? (2) Or when the shareholding is sold a number of years later, should the cash obtained via the rights issue be included in the overall calculation of gain? Many thanks