Commentary

D2.106 Definition of a group—meaning of subsidiaries

Corporate tax
Corporate tax | Commentary

D2.106 Definition of a group—meaning of subsidiaries

Corporate tax | Commentary

D2.106 Definition of a group—meaning of subsidiaries

A company is a subsidiary if it1:

  1.  

    •     is a body corporate (D2.107)

  2.  

    •     has ordinary share capital (D2.108)

  3.  

    •     is beneficially owned (D2.109) by another body corporate

A subsidiary can be either a 51%, 75% or 90% subsidiary. The extent of ownership required to form a group varies depending upon the provisions in question (eg the provisions permitting surrender of tax payments (D1.1321) require only 51% ownership, whereas the group relief provisions (Division D2.2) require 75% ownership).

Essentially a subsidiary is a:

  1.  

    (a)     51%2 subsidiary if more than 50% of its ordinary share capital

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