Section 88 — Corporation Tax Act 2010: Substitution of new shares for old shares

Substitution of new shares for old shares 88 1 Subsection (2) applies if, in the case of any new shares held by a company or by a nominee for a company, the old shares for which they were exchanged were shares which had been subscribed for by the company (“the investor”).

2 This Chapter has effect in relation to any subsequent disposal or other event as if—

a the new shares had been subscribed for by the investor at the time when, and for the amount for which, the old shares were subscribed for by the investor, b the new shares had been issued by the new company at the time when the old shares were issued to the investor by the old company, and c any requirements of this Chapter which were met at any time before the exchange by the old company had been met at that time by the new company.

3 Nothing in subsection (2) applies in relation to section 195(7) of ITA 2007 as applied by section 79(7) above for the purpose of the definition of “excluded activities”.