I had some shares in a company that was acquired "by means of a scheme of arrangement under section 425 of the companies act". Upshot was that the shares I had were effectively purchased from me. Is this subject to income tax, or capital gains tax, and if it's capital, do I only need to declare it if my total Capital gain for past tax year is greater than the ~£8500 allowance?
If youn go to the HMRC web site and click on "Self-Assessment" at the top (not "do it online"), they now have all the forms and help sheets for 2005-6 available to download. You need SA108 and S108-Notes.
You have disposed of the shares and received a capital sum in exchange. If that sum exceeds £34,000, then you have to declare the disposal, even if the gain was less than £8,500. The actual words are:
Fill in the Capital Gains Pages if: ? you disposed of chargeable assets in the year to 5 April 2006 worth more than £34,000, or ? you have allowable losses which must be deducted from your chargeable gains for the year and your chargeable gains before deducting losses and applying taper relief total more than £8,500, or ? you have no allowable losses which must be deducted from your chargeable gains for the year and after applying taper relief your taxable gains total more than £8,500, or ? you want to claim an allowable capital loss, or make any other Capital Gains claim or election for the year.
OK, in my case, it was a £100 total sale, and £50 gain... so tax man need not know :-) (And that was all of my total gains/disposals from last year.
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