- HMRC is consulting on proposals to modernise the tax framework for distributions and repayments of capital from companies. The consultation focuses on shareholders within the charge to Income Tax, including individuals and trusts, and is not intended to affect corporate shareholders directly.
- The proposals cover several long-standing areas of the distributions regime, including the treatment of new consideration and repayments of capital, distributions from non-UK resident companies, loans to participators, demergers, purchase of own shares relief, and the Transactions in Securities rules.
- The stated aim is to improve clarity and consistency, reduce unintended differences in tax treatment, and ensure genuine commercial activity is not adversely affected.
- Timing: the consultation closes on 14 September 2026. The government will analyse the consultation responses and publish a summary of responses after the consultation closes. The government may seek to engage in further consultation on specific reforms.
Resources (click to open)
- Modernising the taxation of distributions and repayments of capital from companies (HMRC consultation, closes 14 September 2026)
