Security converts into shares

In the example at CFM55260, Abacus converted a security into 10,000 ordinary shares in X plc. The transaction is one to which TCGA1992/S132 applies, so that no disposal of the ‘old asset’ (the convertible security) is deemed to take place, and instead the base cost of the ‘new asset’ (the shares) is identified with the cost of the ‘old asset’ (the convertible security). In that example, the cost was £1million.

However CTA09/S670(5) adjusts this £1m base cost of the shares for the purposes of a subsequent disposal. It is treated as increased (or reduced) by the total of:

Need help? Get subscribed!

To subscribe to this content, simply call 0800 231 5199

We can create a package that’s catered to your individual needs.

Or book a demo to see this product in action.