In Flix Innovations v HMRC [2015] UKFTT 558 (6 November 2015) the FTT found that preferential rights attaching to ordinary shares could not be ignored for enterprise investment scheme (EIS) purposes (ITA 2007 Part 5).
As part of a reorganisation of the capital of the company ordinary shares which carried a small preferential right had been issued. However EIS relief is not available if the shares acquired carry ‘any present or future preferential right to a company’s assets on its winding up’ (s 173(2)(aa)). The issue was therefore the correct interpretation s 173(2) and more specifically whether ordinary shares which carried small preferential rights to a return on capital on a winding up were caught.
The FTT first noted that as acknowledged in Arrowtown [2003] HKCFA 46 the words of a particular statute may...
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In Flix Innovations v HMRC [2015] UKFTT 558 (6 November 2015) the FTT found that preferential rights attaching to ordinary shares could not be ignored for enterprise investment scheme (EIS) purposes (ITA 2007 Part 5).
As part of a reorganisation of the capital of the company ordinary shares which carried a small preferential right had been issued. However EIS relief is not available if the shares acquired carry ‘any present or future preferential right to a company’s assets on its winding up’ (s 173(2)(aa)). The issue was therefore the correct interpretation s 173(2) and more specifically whether ordinary shares which carried small preferential rights to a return on capital on a winding up were caught.
The FTT first noted that as acknowledged in Arrowtown [2003] HKCFA 46 the words of a particular statute may...
If you or your firm subscribes to Taxjournal.com, please click the login box below:
If you do not subscribe but are a registered user, please enter your details in the following boxes:
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