Legislation will be introduced in Finance Bill 2015 amending ITTOIA 2005 to remove the ‘unfair tax advantage’ provided by B share schemes. The new rules will take effect from 2015/16 and will apply where a person has a choice either to: receive a distribution from a company; or receive an alternative receipt that has the same or substantially the same value as the distribution and which is not charged to income tax. These proposals affect a well-established practice that many will have assumed was blessed by the GAAR guidance. Nonetheless, it will now no longer be possible to offer shareholders a choice of income or capital treatment on a return of value
