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Investing in young companies

Article Abstract:

Small company stocks will be traded on the London Stock Exchange's "Third Market" beginning on January 26, 1987. The small British companies whose stocks will be quoted on this market are expected to meet three criteria: (1) at least one year of audited financial results will be available, (2) in the case of companies seeking expansion or venture capital, product developments and special projects planned will be documented for the benefit of investors, or (3) companies already listed on the Recognised Investment Exchange may transfer their listings to this new market. These criteria are not mandatory, however, and no size requirements will have to be met prior to obtaining a listing. The London Exchange plans to keep the costs associated with listing to a minimum, although some compliance with British company laws will be required with respect to the filing of prospectuses. Touche Ross estimates that the cost of listing on the Exchange's "Third Market" should be 20,000 pounds sterling or 70,000 pounds in those cases in which the small business must first issue a prospectus.

Security and commodity exchanges, United Kingdom, Innovations, Investments, Small business, Corporations, London Stock Exchange PLC, Great Britain, Corporations, British

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Trading losses and how to convert them

Article Abstract:

Section 72 of the Finance Act of 1991 offers considerable tax relief to unincorporated traders who have incurred losses. The new regulation provides a way for the trading loss to be used to reduce the capital gains tax charge resulting from the sale of trade or investments. If traders meet given requirements, they can compute their loss according to a method specified in Sec 380. This three-stage approach involves the computation of the so-called 'relevant amount,' the calculation of the 'maximum amount,' and the use of the tax relief. The major planning areas that traders should pay attention to include the transfer of chargeable assets between spouses, the cessation of trade, the disposal of chargeable assets, the handling of capital allowances and dealing with all available options.

Analysis, Interpretation and construction, Tax law, Loss deductions

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