Finance Act 1967

Premiums on conversion of securities

4 (1) This paragraph applies where, on a conversion of securities, a person receives, or becomes entitled to receive, any sum of money which is by way of consideration (in addition to his new holding) for the disposal of the converted securities.

(2) If the inspector is satisfied that the sum is small, as compared with the value of the converted securities, and so directs—

(a) receipt of the sum shall not be treated for the purposes of Part III of the Finance Act 1965 as a disposal of part of the converted securities, and

(b) the sum shall be deducted from any expenditure allowable under the said Part III as a deduction in computing a gain or loss on the disposal of the new holding by the person receiving or becoming entitled to receive the said sum,

and paragraph (a) above shall have effect notwithstanding paragraph 4(4) of Schedule 7 to the [1965 c. 25.] Finance Act 1965 as applied to conversions of securities by paragraph 5 of that Schedule.

(3) A person who is dissatisfied with the refusal of the inspector to give a direction under this paragraph may appeal to the Commissioners having jurisdiction on an appeal against an assessment to tax in respect of a gain accruing to him on a disposal of the securities.

(4) Paragraph 9 of Schedule 10 to the [1966 c. 18.] Finance Act 1966 (which deals with cases where no expenditure is attributable to the asset or that expenditure is small) shall apply as if this paragraph were mentioned in the said paragraph 9(1).

(5) In this paragraph " conversion of securities " and " security " shall be construed in accordance with paragraph 5(3) of Schedule 7 to the Finance Act 1965.

(6) This paragraph has effect as respects sums becoming payable on or after 6th April 1967.