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Unlocking dividends

14 February 2012 / Pete Miller
Issue: 4341 / Categories: Comment & Analysis , Companies
Is the draft legislation on capital distributions really the key to consistency, asks PETE MILLER


  • Definition of capital distributions.
  • Impact of capital gains tax rules.
  • Distributions for purpose of the corporation tax acts.
  • Anomalies within the legislation.
  • Winding up a company.

Changes to the distributions legislation were included in the draft Finance Bill issued on 6 December 2011 following consultation over concerns about the rules for so-called capital distributions.

This article explains the background to these changes and explores what they achieve and whether they were necessary. It will also look at how the distributions rules work in some other contexts.

It is not intended to analyse every permutation of the distributions legislation and does not for example consider distributions to income taxpayers.

It will look at a few distributions to corporation taxpayers specifically distributions in specie as...

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