Section 1022 — Corporation Tax Act 2010: Bonus issue following repayment of share capital treated as distribution

Bonus issue following repayment of share capital treated as distribution 1022 1 Subsection (3) applies if a company—

a repays or has repaid any share capital, and b at or after the time of the repayment issues any share capital as paid up otherwise than by the receipt of new consideration.

2 But subsection (3) does not apply so far as any provision of the Corporation Tax Acts makes contrary provision.

3 The amount paid up as mentioned in subsection (1)(b) is treated for the purposes of the Corporation Tax Acts as a distribution made in respect of the shares on which it is paid up, except so far as that amount exceeds the adjusted amount of the repaid share capital.

4 The reference in subsection (3) to the adjusted amount of the repaid share capital is to—

a the amount, or total amount, of share capital repaid as mentioned in subsection (1)(a), minus b any amounts previously paid up as mentioned in subsection (1)(b) and treated as distributions by virtue of subsection (3).