cgta79/s77.- Capital Gains Tax Act 1979 Section 77 Application of sections 78 to 81.

CHAPTER II

REORGANISATION OF SHARE CAPITAL, CONVERSION OF SECURITIES, ETC.

Reorganisation or reduction of share capital

77. - (1) For the purposes of this section and sections 78 to 81 below "reorganisation" means a reorganisation or reduction of a company's share capital, and in relation to the reorganisation -

[1965 Sch. VII
4(1); 1966
Sch.X 7(3).]

(a) "original shares" means shares held before and concerned in the reorganisation,

(b) "new holding" means, in relation to any original shares, the shares in and debentures of the company which as a result of the reorganisation represent the original shares (including such, if any, of the original shares as remain).

[1965 Sch. VII
4(1)(a).]

(2) The reference in subsection (1) above to the reorganisation of a company's share capital includes -

(a) any case where persons are, whether for payment or not, allotted shares in or debentures of the company in respect of an in proportion to (or as nearly as may be in proportion to) their holdings of shares in the company or of any class of shares in the company, and

(b) any case where there are more than one class of share and the rights attached to shares of any class are altered.

[1965 Sch. VII
4(7).]

(3) The reference in subsection (1) above to a reduction of share capital does not include the paying off of redeemable share capital, and where shares in a company are redeemed by the company otherwise than by the issue of shares or debentures (with or without other consideration) and otherwise than in a liquidation, the shareholder shall be treated as disposing of the shares at the time of the redemption.