Tax

In the new, post-Brexit referendum world, it appears that demergers have largely fallen out of favour. Although there are likely numerous tax, political and economic factors behind the reduction in demergers, the introduction of section 77A of the Finance Act 1986 (1986 Act) (section 77A), which applies to share transfers executed on or after 29 June 2016 and gives rise to an additional stamp duty cost for partition demergers undertaken by way of capital reduction, will do little to reverse the trend. Read more.