Disposal of Shares
09/01/1987
Query
Would the exchange of shares in a RICT company for equal shares in a new holding company (also a qualifying company) lead to a loss of RICT relief?
Decision
No - where the restructuring is essential to ensure that the existing employment is safeguarded and future job creation is facilitated.
Income Tax
Section 498 (1), Taxes Consolidation Act, 1997
Origin: Direct Taxes International and Administration
File ref:191/85
05/05/1988
Query
If investors swap their shares in a subsidiary for shares in a holding company, it would normally be referred to as disposal. However, because Section 498(1)(b) [previously 17(1)(b)] applies, there is no clawback of the relief because no consideration was received by the shareholders. Is this true?
Decision
No. Revenue would not accept this interpretation of the section. However, they would be prepared to consider allowing investors to retain relief if the existing investors in the qualifying subsidiary were given shares in the qualifying company on a share for share basis.
Income Tax
Section 498 (1)(b), Taxes Consolidation Act, 1997
Origin: Direct Taxes International and Administration
File ref:4395/88