Commentary

D1.1034 Substantial shareholding exemption—Meaning of trading sub-group

Corporate tax
Corporate tax | Commentary

D1.1034 Substantial shareholding exemption—Meaning of trading sub-group

Corporate tax | Commentary

D1.1034 Substantial shareholding exemption—Meaning of trading sub-group

The definition of trading sub-group1 for the purpose of the substantial shareholding exemption (SSE) repeats verbatim the definition of trading group (see D1.1033) substituting sub-group for group where appropriate. A sub-group is later defined as two or more companies which would form a group but for the fact that one of them is a 51% subsidiary of another company, that is to say an intermediate holding company2. For example, H Ltd owns 100% of the share capital of A Ltd, which in turn owns 100% of the share capital of B Ltd and C Ltd. A Ltd, B Ltd and C Ltd form a sub-group for this purpose, although the sub-group is prevented from being a group in its own right for capital gains tax purposes

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