Dr Michael Smurfit recently sold shares in Smurfit Stone Container worth $9.5 million (€8 million).

The good doctor, who retired from Smurfit Stone earlier this year to concentrate on his role as chairman of the now private Jefferson Smurfit Group, doesn't have to worry about his capital gains tax liability as he is resident abroad. The same cannot be said for the thousands of former Irish shareholders in the company.

The structure of the leveraged buy-out of the listed Jefferson Smurfit Group last year was so complicated - investors were paid through a mix of spun-off Smurfit Stone shares, cash and loan notes - that the Revenue has published special advice on calculating capital gains tax liability.

The first thing shareholders need to do is work out when their shares were acquired. For instance, there were bonus issues in July 1985 (one share for every two held), 1992 (one for one) and 1995 (one for one). There was also a one for 10 rights issue in 1994.

If a shareholder bought 5,000 shares in early 1985 and took up the rights issue, they would have held 33,000 shares by the time Smurfit delisted even without buying another share.

The first element of the deal was a move to split the original shares on a 10-for-one basis. This move, designed to facilitate later technical elements of the deal, does not carry any capital gains tax implication as it did not entail any "sale" of the shares.

Next was the spinning-off of Smurfit Stone. Jefferson Smurfit shareholders got one Smurfit Stone share for every 16 shares held in the parent group.

This does count as a "disposal" by shareholders. The Revenue has determined that the "sale price" for the purposes of capital gains will be the price of Smurfit Stone shares in the market on September 3rd last year when the Madison Dearborn offer for Smurfit was declared unconditional.

It has set the price at $13.6101, which, at a conversion rate of €1 = $0.9959, gives a euro price of €13.67 per share.

Multiplying that number by the number of Jefferson Smurfit shares originally held before the share split and dividing the answer by 16 gives the overall sale value.

From this, investors need to subtract the "base cost" - the figure determined as the purchase price of that part of their Smurfit holding now accounted for by Smurfit Stone stock.

This is calculated by multiplying the original cost of the shares (indexed as appropriate) by the "overall sale value" above and dividing this sum by the overall sale price plus the cash received for the balance of the Smurfit shares.

Obviously, the base cost will be different for shares acquired at different times. Bonus shares have no cost.

Having got the Smurfit Stone element out of the way, you now need to turn to the capital gain on the rump of your old Smurfit holding.

If you took payment in cash, as most small shareholders will have done, you can easily work out the proceeds of that sale by multiplying the number of shares held by the €2.15.

From this you need to subtract the "base cost". This is the original cost of the shares, indexed if necessary, minus the base cost of the Smurfit Stone shares.

Shareholders opting for payment in loan notes will not be deemed to have "sold" the shares at that point. However, when they do redeem the loan notes, the notes will be seen by the Revenue as having been acquired on the same date as the shareholder's original Jefferson Smurfit shareholding. The base cost will be the same as the base cost for cash payments outlined above.

Anyone who opted to be paid partly in cash and partly in loan notes should refer to Issue 53 of the Revenue tax briefing on its website at www.revenue.ie under publications.