CIOT comments on Finance (No.2) Bill – proposed changes to the SSE

Released 10 August 2017

The Chartered Institute of Taxation (CIOT) has published comments sent to HMRC on the revised draft clause published on 13 July 2017 introducing a new substantial shareholding exemption (SSE) for qualifying investors with effect from 1 April 2017.

The measure is due to be included in a second 2017 Finance Bill to be published after Parliament’s summer recess after it was dropped from Finance Act 2017 in the run up to the General Election.

The CIOT has raised concerns about the way in which the definition of a ‘substantial shareholding’ operates for qualifying institutional investors in circumstances where the shareholding is less than 10%, but cost more than £20m. This aspect of the clause remains unchanged from the clause included in the original pre-election Finance Bill published earlier this year. The CIOT is concerned that, as drafted, the test is likely to prevent qualifying institutional investors from the exemption meaning that the policy intention will not be fulfilled.

View and/or download the submission Finance (No.2) Bill - Proposed changes to SSE - CIOT comments

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