Readers' forum : Is this a wind-up?

Instead of winding up my client’s company (A Ltd) an insolvency practitioner has suggested that X plc will buy all the shares. This means no worries about ITTOIA 2005 s 396B because it applies only to liquidations. Further I am told the transaction in securities (TIS) provisions will not apply because the entire shareholding is disposed of so there is no possibility of a TIS counteraction notice due to the ‘fundamental change of ownership’ rules in ITA 2007 s 687.

The shareholders will not receive full value because X plc will in effect charge a fee. But by avoiding distribution treatment and with entitlement to entrepreneurs’ relief these charges are acceptable.

Is it permissible to promote such a course of action to my client given the new Professional Conduct in Relation to Taxation (PCRT)? Clearly s 396B was designed to prevent the well-tried...