CG57100 | Close companies: special rules for shares

Two CGT rules may affect the CGT treatment of a disposal of shares in a close company. CT60000+ provide general guidance on close companies with abroad definition at CT60060.

TCGA92/S124

This reduces the gain on the disposal of shares if the shareholder has incurred a higher rate income tax liability on a close company apportionment. It is possible that the CGT rule may still apply even though the income tax provisions were repealed in 1989. See CG57001.

TCGA92/S125

This decreases the CGT base cost of shares if a close company has transferred assets other than by way of a bargain made at arm’s length at undervalue. See CG57002.