UK Taxation position from Kyndryl spin off from IBM?

ToLeadABetterLife

I own shares in IBM and they did a spin off off of Kyndryl, so now I own shares in both companies.

I am trying to ascertain if this pure paperwork distribution is liable for Income Tax in the UK or not.
(I understand any small cash settlement for the share fraction might incur income tax, that I accept. I also understand the taxation rules around normal UK stock dividends, but that is not my question here.)

I note that in their announcements that they stated that in the USA there would be no income tax but for foreign investors we should all go find a tax advisor to check the position. I wrote to HMRC who pointed me at deeply technical documentation so that wasn't helpful and Computershare restated, go speak to your tax advisor.

I have read something about a dividend in specie but that seems to be where you wish to not pay out a cash dividend but do it with assets. I assume perhaps I get a 100K asset which I can then sell v's a cash dividend. So that doesn't seem to fit the spin off that IBM did either.

Any helpful guidance would be much appreciated.

Information from ibm investors web site re faqs-about-the-kyndryl-holdings-inc-distribution

Is this a taxable transaction?

We expect that the distribution of Kyndryl common stock will be tax-free to holders of IBM common stock for U.S. federal income tax purposes, except for cash that stockholders may receive (if any) in lieu of a fractional share.  Foreign, as well as U.S. Stockholders, should contact their own tax advisor with respect to the U.S. federal, state and local, and foreign tax consequences of the distribution.

How did IBM distribute shares of Kyndryl common stock?

IBM distributed to its stockholders, as a pro rata dividend, one share of Kyndryl common stock for every five shares of IBM common stock outstanding as of the record date of the distribution.  Prior to the distribution, IBM delivered 80.1% of the issued and outstanding shares of Kyndryl common stock to the distribution agent, Computershare Trust Company, N.A. (“Computershare”).  Computershare was the distribution agent in connection with the distribution and is the transfer agent and registrar for both IBM and Kyndryl.

If you owned IBM common stock as of the close of business on October 25, 2021, the shares of Kyndryl common stock that you were entitled to receive in the distribution were issued as follows: