SCHEDULE 16GROUP RELIEF
PART 2THE RELIEF
2Group relief
1
A land transaction is relieved from tax if the seller and the buyer are companies that are members of the same group at the effective date of the transaction.
2
Relief under this paragraph is referred to in this Schedule as “group relief”.
3
This paragraph is subject to paragraph 4 (restrictions on availability of group relief) and paragraphs 8 and 12 (withdrawal of group relief).
3Group relief: interpretation
1
The following provisions apply for the purposes of group relief.
2
“Company” means a body corporate.
3
Companies are members of the same group if one is the 75% subsidiary of the other or both are 75% subsidiaries of a third company.
4
A company (“company A”) is the 75% subsidiary of another company (“company B”) if company B—
a
is beneficial owner of not less than 75% of the ordinary share capital of company A,
b
is beneficially entitled to not less than 75% of any profits available for distribution to equity holders of company A, and
c
would be beneficially entitled to not less than 75% of any assets of company A available for distribution to its equity holders on a winding-up.
5
For the purposes of sub-paragraph (4)(a)—
a
the ownership referred to is ownership either directly or through another company or companies, and
b
the amount of ordinary share capital of company A owned by company B through another company or companies is to be determined in accordance with sections 1155 to 1157 of the Corporation Tax Act 2010 (c. 4).
6
In sub-paragraphs (4)(a) and (5)(b), “ordinary share capital”, in relation to a company, means all the issued share capital (by whatever name called) of the company, other than capital the holders of which have a right to a dividend at a fixed rate but have no other right to share in the profits of the company.
7
Chapter 6 of Part 5 of the Corporation Tax Act 2010 (c. 4) (group relief: equity holders and profits or assets available for distribution) applies for the purposes of sub-paragraph (4)(b) and (c) as it applies for the purposes of section 151(4)(a) and (b) of that Act.
8
But sections 171(1)(b) and (3), 173, 174 and 176 to 178 of that Act are to be treated as omitted for the purposes of sub-paragraph (4)(b) and (c).