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Issue: Vol 168, Issue 4327 [2] Related articles: Messy liquidation [7] Is that clear? [8] Do we have a group? [9] PETE MILLER asks where we now stand with the complex transactions in securities legislation KEY POINTS The basic framework of ITA 2007, s 684. Activities that fall within the definition of a 'transaction in securities'. The receipt of 'relevant consideration' from certain transactions. The exemption where 75% of a shareholding is transferred. Calculating the income tax benefit. Where to find more guidance from HMRC. The transactions in securities (TiS) anti-avoidance rules are designed to prevent a range of tax avoidance techniques that broadly seek to turn potential income payments into capital payments, on the basis that the tax charge on capital gains is usually lower than the income tax on a distribution of the same amount. The rules are very relevant to the small and medium-sized enterprises (SME) market, because they only apply to transactions in securities of close companies (or companies that would be close if they were UK resident): those that are controlled by five or fewer persons or by any number of shareholder-directors. The rules were changed substantially in FA 2009 [10] and this article looks at the rules as they currently apply. It is generally accepted that the rules for corporation tax have no application and are probably obsolete, so we are only going to look at the rules for income tax purposes.