Introduction Overview Chapter 2: Matters which are distributions Section 1024: Premiums paid on redemption of share capital
3026.This section works with section 1025 to determine what is treated as a repayment of share capital. It is based on section 211(7) of ICTA.
3027.The starting point is that a premium paid on redemption of share capital is not treated as a repayment of share capital. This is further qualified by section 1025.
3028.The source legislation in section 211(7) of ICTA is not expressly limited in its application, but analysis of the legislation has shown that its practical application is limited to matters within the distributions legislation. This has now been made explicit by limiting its effect to this Chapter. See Change 57in Annex 1.