Part 2

Plant and machinery allowances
Chapter 5

Allowances and charges

Annual investment allowance

Companies and groups: meaning of “related”
51G
1
A company (“C1”) is related to another company (“C2”) in a financial year if one or both of—
a
the shared premises condition, and
b
the similar activities condition,
are met in relation to the companies in that financial year.
2
Where C1 is related to C2 in a financial year, C1 is also related to any other company to which C2 is related in that financial year.
3
A group of companies (“G1”) is related to another group of companies (“G2”) in a financial year if in that financial year a company which is a member of G1 is related to a company which is a member of G2.
4
Where G1 is related to G2 in a financial year, G1 is also related to any other group of companies to which G2 is related in that financial year.
5
The shared premises condition is met in relation to two companies in a financial year if, at the end of the relevant chargeable period of one or both of the companies, the companies carry on qualifying activities from the same premises.
6
The similar activities condition is met in relation to two companies in a financial year if—
a
more than 50% of the turnover of one company for the relevant chargeable period is derived from qualifying activities within a particular NACE classification, and
b
more than 50% of the turnover of the other company for the relevant chargeable period is derived from qualifying activities within that NACE classification.
7
In this section—
- “
NACE classification
” means the first level of the common statistical classification of economic activities in the European Union established by Regulation
(
EC
) No 1893/2006
of the European Parliament and the Council of 20 December 2006 (as that Regulation has effect
in EU law
), and
- “
relevant chargeable period
”, in relation to a company and a financial year, means the chargeable period of the company ending in that financial year.
Pt. 2 modified (24.2.2003) by Proceeds of Crime Act 2002 (c. 29), s. 458(1), Sch. 10 para. 12 (with Sch. 10 para. 17(1)); S.I. 2003/120, art. 2, Sch. (with arts. 3 4) (as amended (20.2.2003) by S.I. 2003/333, art. 14)
S. 45H(2) modified (with effect in accordance with s. 167 of the amending Act) by Finance Act 2003 (c. 14) , Sch. 30 para. 7
Pt. 2 restricted (5.10.2004) by Energy Act 2004 (c. 20) , s. 198(2) , Sch. 4 para. 4 ; S.I. 2004/2575 , art. 2(1) , Sch. 1
Pt. 2 modified (5.10.2004) by Energy Act 2004 (c. 20) , s. 198(2) , Sch. 9 paras. 9(2), 21(2) (with s. 38(2)); S.I. 2004/2575, art. 2(1) , Sch. 1
Pt. 2 restricted (5.10.2004) by Energy Act 2004 (c. 20) , s. 198(2) , Sch. 9 para. 10 (with s. 38(2) ); S.I. 2004/2575 , art. 2(1) , Sch. 1
Pt. 2 modified (5.10.2004) by Energy Act 2004 (c. 20) , s. 198(2) , Sch. 9 para. 21(2) (with s. 38(2) ); S.I. 2004/2575 , art. 2(1) , Sch. 1
Pt. 2 restricted (5.10.2004) by Energy Act 2004 (c. 20) , s. 198(2) , Sch. 9 paras. 10, 22 (with s. 38(2) ); S.I. 2004/2575 , art. 2(1) , Sch. 1
Ss. 51A-51N and cross-heading inserted (with effect in accordance with Sch. 24 para. 23 to the amending Act) by Finance Act 2008 (c. 9), Sch. 24 para. 3
Pt. 2 modified (22.7.2008) by Crossrail Act 2008 (c. 18), Sch. 13 para. 19
Pt. 2 modified (22.7.2008) by Crossrail Act 2008 (c. 18), Sch. 13 para. 35
Pt. 2 modified (22.7.2008) by Crossrail Act 2008 (c. 18), Sch. 13 paras. 36, 37
Pt. 2 modified (21.7.2009) by Finance Act 2009 (c. 10), s. 24
Pt. 2 modified (17.7.2013) by Finance Act 2013 (c. 29), s. 73(7)-(11) (with s. 73(6))
Words in s. 51G(7) substituted (31.12.2020) by The Taxes (Amendments) (EU Exit) Regulations 2019 (S.I. 2019/689), regs. 1, 10(2) (with regs. 39-41); 2020 c. 1, Sch. 5 para. 1(1)
Pt. 2 modified (10.6.2021) by Finance Act 2021 (c. 26), s. 9(1)(a)
Pt. 2 modified (11.7.2023) by Finance (No. 2) Act 2023 (c. 30), s. 7