Into the great unknown
KEY POINTS
- The targeted anti-avoidance rule in ITTOIA 2005 s 396B has far-reaching consequences if a members’ voluntary liquidation takes place.
- The aim of the legislation is to counter ‘phoenixism’ – starting a new business soon after winding up a previous one.
- Taxpayers are expected to self-assess if the new targeted anti-avoidance rule will result in a liability under s 396B.
- Condition C (see s 396B(4)) is met where at any time within the period of two years beginning with the date on which the liquidation distribution in question is made any one of the four Condition C ‘trigger events’ occurs. These are that:
- The condition does not only apply when a new business is started after liquidation or distribution; other pre-existing businesses may trigger a liability. ...
Alternatively, you can register free of charge to read a limited amount of subscriber content per month.
Once you have registered, you will receive an email directing you back to read this item in full.