Summary
Redeemable shares with no right to dividends were not ‘ordinary share capital’ for entrepreneurs’ relief purposes, and were therefore not required to be taken into account in determining whether the company was the taxpayers’ ‘personal company’ for relief purposes.
Background
The appellants (husband and wife) established a company in August 2004, and each held 33 ordinary £1 shares out of the company’s issued share capital of 100 ordinary shares. The shareholders who held the remaining 34 shares later lent £30,000 to the company as a directors’ loan. In June 2006, the loan was converted into 30,000 non-voting redeemable shares of £1 each.
In autumn 2009, the 30,000 non-voting redeemable shares were redeemed at par. On 1 January 2010, a large enterprise acquired all of the 100
