http://www.legislation.gov.uk/ukpga/2007/3/section/257HBIncome Tax Act 2007An Act to restate, with minor changes, certain enactments relating to income tax; and for connected purposes.texttext/xmlenStatute Law Database2026-09-18Expert Participation2026-09-16 Income Tax Act 2007s. 788(7)Legal Services Act 2007Sch. 21 para. 161(b)s. 29 192 193s. 211(2)art. 2(h) PART 5ACHAPTER 8257HB1This section applies if—aa company (“the new company”) in which the only issued shares are subscriber shares acquires all the shares (“old shares”) in another company (“the old company”),bthe consideration for the old shares consists wholly of the issue of shares (“new shares”) in the new company,cthe consideration for the new shares of each description consists wholly of old shares of the corresponding description,dnew shares of each description are issued to the holders of old shares of the corresponding description in respect of and in proportion to their holdings,eat some time before the issue of the new shares—ithe old company issued shares which meet the requirements of section 257CA(2), andiia compliance certificate in respect of those shares was issued by that company for the purposes of subsection (1) of section 257EB and in accordance with section 257EC, andfbefore the issue of the new shares the Commissioners for Her Majesty's Revenue and Customs have, on the application of the new company or the old company, notified that company that they are satisfied that the exchange of shares—iwill be effected for genuine commercial reasons, andiiwill not form part of any such scheme or arrangements as are mentioned in section 137(1) of TCGA 1992 (schemes with avoidance purposes).In this subsection references to shares, except in the expressions “subscriber shares” and “shares which meet the requirements of section 257CA(2)“, include securities.2Subsection (2) of section 138 of TCGA 1992 (procedure for advance clearance) applies for the purposes of subsection (1)(f) as it applies for the purposes of subsection (1) of that section.3For the purposes of this Part—athe exchange of shares is not regarded as involving any disposal of the old shares or any acquisition of the new shares, andbany SEIS relief which is attributable to any old shares is attributable instead to the new shares for which they are exchanged.4Nothing in section 257DG (the control and independence requirement) applies in relation to such an exchange of shares, or shares and securities, as is mentioned in subsection (1), or arrangements with a view to such an exchange.5For the purposes of this section old shares and new shares are of a corresponding description if, on the assumption that they were shares in the same company, they would be of the same class and carry the same rights.6References in sections 257HC and 257HD to “old shares”, “new shares”, “the old company” and “the new company” are to be read in accordance with this section.Pt. 5A applied by Taxation of Chargeable Gains Act 1992 (c. 12), Sch. 5BB para. 8(4) (as inserted (17.7.2012) by Finance Act 2012 (c. 14), Sch. 6 para. 5)Pt. 5A inserted (17.7.2012) (with effect in accordance with Sch. 6 para. 24(1) of the amending Act) by Finance Act 2012 (c. 14), Sch. 6 para. 1