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Tax treatment of a company holding land to sell on to a developer.
Company A was formed two years ago to acquire land and obtain planning permission to sell on to a developer. Permission has now been obtained and the land is to be offered for sale to a developer to build dwellings for resale.
There is an option to sell the company shares rather than the land itself.
Under the old transactions in land rules in CTA 2010 and 2007 the sale of shares in such a situation was specifically exempt if: the company held the land as trading stock; the land held will be disposed of by the company in the normal course of its trade; and all land held by the company is disposed of in such a way that all opportunity of profit from the land arises to the company.
I understand that these rules are now abolished and have been replaced. Guidance on the new provisions is...
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