Redeemable preference shares meaning

As set out in Scope of distributions for tax purposes, distributions fall into four categories: dividends — covering paragraph A, with fuller guidance in Tax—types of distribution—dividends transfers of assets or liabilities — covering paragraphs B and G, with further detail in Tax—types of distribution—transfers of assets and liabilities interest recharacterised as a distribution — spanning paragraphs E and F, with more detail in Types of distribution—interest recharacterised as a distribution: non-commercial securities and Types of distribution—interest recharacterised as a distribution: special securities bonus issues of shares or securities — covering paragraphs C, D and H and discussed further in this note Paragraphs C and D—Redeemable share capital and securities The third and fourth categories comprise the company issuing any redeemable share capital or any securities: in respect of shares in, or securities of, the company; and otherwise than for new consideration Distributions within paragraph C or D are often termed ‘CD distributions’,...

Eight anti-avoidance rules block the use of one or more exemption classes for distributions received by companies that are not small. For an outline of the exempt categories, refer to Practice Note: How are non-small companies taxed on distributions received? For the definition of a small company, see Practice Note: What is a small company for the purposes of the distribution exemption? This Practice Note explains four of those anti-avoidance provisions, aimed at distributions which, absent such anti-avoidance rules, would otherwise fall within one or more particular exempt classes as set out in this Practice Note...