I have a limited company with three shares split 2:1 between myself and my wife. The company is worth approx. £1m. I would like to gift one share each to my mother and father. Would these transactions be subject to capital gains tax at the market value and if so, would capital gains tax (CGT) gift holdover relief be available or can additional shares simply be issued and allocated at a £1 value?  

Arthur replies: 

These transactions would be subject to CGT at market value, as you have written. Gift holdover relief could be available if the company is a trading company, so that the shares qualify as 'business assets' (see HMRC’s Capital Gains Manual at CG66884). Issuing additional shares will not avoid triggering CGT because of the ‘value shifting’ anti-avoidance rules. See the example of Mr White in CG58855.