Amendments made: 38, in schedule 6, page 180, line 32, leave out

“by a person (‘P’) other than a company”.

This amendment allows for the distributions relief to be given in circumstances where the capital gains tax relief for employee ownership trusts is not available because the vendor of the shares in the company to which the employee ownership trust relates is a company (provided the other conditions for the capital gains tax relief being given are met).

Amendment 39, in schedule 6, page 181, line 2, at end insert—

“(d) the payment was made for the purposes of meeting the trustees’ acquisition costs.”

This amendment requires that the distribution that is the subject of the relief was actually made for the purposes of meeting acquisition costs.

Amendment 40, in schedule 6, page 181, line 10, after “trusts)” insert

“, but those requirements have effect for the purposes of this section as if references to ‘P’ were to the person making the disposal whether or not that person is a company”.

This amendment is consequential on Amendment 38, and secures that the capital gains tax relief requirements are capable of applying properly in circumstances where the vendor of the shares in the company to which the employee ownership trust relates is a company.

Amendment 41, in schedule 6, page 181, line 11, leave out “subsection (2)” and insert “this section”.

This amendment is consequential on Amendment 39 (and secures that “acquisition costs” is defined for the purposes of the whole section).

Amendment 42, in schedule 6, page 181, line 12, after “are” insert

“sums expended by the trustees on”.

This amendment, and Amendment 43, expand the scope of acquisition costs that can benefit from the relief.

Amendment 43, in schedule 6, page 181, leave out lines 13 to 19 and insert—

“(a) the acquisition of ordinary share capital in C by the trustees that resulted from the disposal;

(b) the repayment of any sums borrowed to fund that acquisition;

(c) the payment of interest on any such sums or in respect of any deferral of consideration for the disposal to the extent the payment is not in respect of interest exceeding a reasonable commercial rate;

(d) any valuation of C carried out in connection with the acquisition;

(e) any liability to stamp duty or stamp duty reserve tax on the acquisition;

(f) such other reasonable expenses as are directly connected with the acquisition (but this does not include any expenses incurred in connection with the ownership of the ordinary share capital once acquired).”—(James Murray.)

This amendment, and Amendment 42, expand the scope of acquisition costs that can benefit from the relief.

Schedule 6, as amended, agreed to.