Search Legislation

Finance (No. 2) Act 2023

 Help about what version

What Version

 Help about advanced features

Advanced Features

Changes over time for: Cross Heading: Groups, partnerships and joint ventures

 Help about opening options

Alternative versions:

Changes to legislation:

There are outstanding changes not yet made by the legislation.gov.uk editorial team to Finance (No. 2) Act 2023. Any changes that have already been made by the team appear in the content and are referenced with annotations. Help about Changes to Legislation

Close

Changes to Legislation

Revised legislation carried on this site may not be fully up to date. Changes and effects are recorded by our editorial team in lists which can be found in the ‘Changes to Legislation’ area. Where those effects have yet to be applied to the text of the legislation by the editorial team they are also listed alongside the legislation in the affected provisions. Use the ‘more’ link to open the changes and effects relevant to the provision you are viewing.

View outstanding changes

Changes and effects yet to be applied to the whole Act associated Parts and Chapters:

Whole provisions yet to be inserted into this Act (including any effects on those provisions):

Groups, partnerships and joint venturesU.K.

287GroupsU.K.

(1)For the purposes of this Part, the following form a “group”—

(a)a company that is not a 75% subsidiary of any other company, and

(b)every company that is a 75% subsidiary—

(i)of that company,

(ii)of a 75% subsidiary of that company, or

(iii)of a 75% subsidiary of a 75% subsidiary of that company, and so on.

(2)The company in a group that is not a 75% subsidiary of any other company is the “principal member” of the group.

(3)Every other member of the group is a “subsidiary member”.

(4)A company (“B”) is a “75% subsidiary” of another company (“A”) if—

(a)A is beneficially entitled to 75% or more of any profits available for distribution to equity holders of B,

(b)A would be beneficially entitled to 75% or more of any assets of B available for distribution to its equity holders on a winding-up, or

(c)at least 75% of B’s ordinary share capital is owned directly or indirectly by A.

(5)Where as a result of the application of each of paragraphs (a) to (c) of subsection (4) a company would (ignoring this paragraph) be a member of more than one group, that company is to be treated as only being a 75% subsidiary of the first company it is a subsidiary of applying the rules in those paragraphs in order (starting with paragraph (a)).

(6)If at any time a company that is a generating undertaking becomes a member of a group that is a generating undertaking (including a group that becomes a generating undertaking as a result of that company becoming a member), the final qualifying period of the company ends at that time.

(7)If at any time a group ceases to be a group as a result of the principal member becoming a 75% subsidiary of another group, the final qualifying period of the group ends at that time.

288Lead member of a group and its qualifying periodsU.K.

(1)For the purposes of section 280(2) (meaning of qualifying period), the reference to an accounting period of a generating undertaking that is a group means an accounting period of its lead member.

(2)Take the following steps in order to identify the lead member of the group (stopping at the first step under which a member of the group is identified as the lead member)—

  • Step 1

    If there is a member of the group that—

    (a)

    is within the charge to corporation tax, and

    (b)

    is nominated for the purposes of this section,

    that member is the lead member of the group.

  • Step 2

    If the principal member of the group is within the charge to corporation tax, it is the lead member of the group.

  • Step 3

    If—

    (a)

    there is a member of the group that—

    (i)

    is within the charge to corporation tax, and

    (ii)

    has no 75% parent within the charge to corporation tax, and

    (b)

    there is no other member of the group falling within paragraph (a),

    that member is the lead member of the group.

  • Step 4

    If there is more than one member falling within paragraph (a) of Step 3, the lead member is the member falling within that paragraph to which the greatest amount of generation would be attributed under section 282(1) in the period of 12 months ending with the later of 31 December 2022 and the beginning of the first qualifying period in which the group is a qualifying generating undertaking if—

    (a)

    each such member were a generating undertaking, and

    (b)

    that period of 12 months were a qualifying period.

  • Step 5

    If none of the preceding steps identifies a lead member, the principal member of the group (who will not be within the charge to corporation tax) is the lead member of the group.

(3)For the purposes of subsection (2), a company (“P”) is a 75% parent of another company if that other company is a 75% subsidiary—

(a)of P,

(b)of a 75% subsidiary of P, or

(c)of a 75% subsidiary of a 75% subsidiary of P, and so on.

(4)A nomination of a member of a group as the lead member of the group—

(a)is to be made by the member of the group that, ignoring Step 1 in subsection (2), would be the lead member of the group (“the nominating member”),

(b)must be made by notice to HMRC,

(c)must specify when it takes effect, which must be no earlier than the commencement of the qualifying period in which it is made, and

(d)has effect until—

(i)a further nomination takes effect,

(ii)it is revoked, or

(iii)the nominated member leaves the group.

(5)The revocation of a nomination of a member of a group as the lead member—

(a)is to be made by the member of the group that, ignoring Step 1 in subsection (2), would be the lead member of the group,

(b)must be made by notice to HMRC, and

(c)must specify when it takes effect, which must be no earlier than the commencement of the qualifying period in which it is made.

(6)Where a company becomes lead member of a group during a qualifying period, and that period is not the same as an accounting period of the new lead member—

(a)the qualifying period ends, and

(b)a qualifying period commences that ends with the end of the current accounting period of the new lead member.

289Liability of members of groupsU.K.

Where a generating undertaking that is a group is liable to an amount of electricity generator levy—

(a)the lead member is liable to pay that amount, and

(b)every other member is jointly and severally liable for that amount.

290Election for members with significant minority shareholding to pay levyU.K.

(1)This section applies where—

(a)a generating undertaking that is a group is liable to an amount of electricity generator levy for a qualifying period,

(b)a subsidiary member of that group (“the relevant member”) has, at any time in that period, at least one significant minority shareholder,

(c)some, or all, of that amount is attributable, on a fair and reasonable basis, to the activities of the relevant member and, if it has one or more relevant subsidiaries, those relevant subsidiaries.

(2)Where this section applies, the lead member of the group may elect that so much of the amount as is attributable to the activities of the relevant member and (where it has one or more relevant subsidiaries) its relevant subsidiaries must be paid by that member.

(3)But the other members of the group are jointly and severally liable for that amount.

(4)An election under this section in respect of an amount of electricity generator levy for a qualifying period must be made no later than 9 months after the end of that period.

(5)For the purposes of this Part

(a)a person (“P”) is a significant minority shareholder in a subsidiary member of a group (“S”) if P is not a member of the group and—

(i)P is beneficially entitled to 10% or more of any profits available for distribution to equity holders of S,

(ii)P would be beneficially entitled to 10% or more of any assets of S available for distribution to its equity holders on a winding-up, or

(iii)at least 10% of S‘s ordinary share capital is owned by P, and

(b)a group of companies (other than the group S is a member of) is a significant minority shareholder in S if—

(i)members of the group are, between them, beneficially entitled to 10% or more of any profits available for distribution to equity holders of S,

(ii)members of the group between them would be beneficially entitled to 10% or more of any assets of S available for distribution to its equity holders on a winding-up, or

(iii)at least 10% of S‘s ordinary share capital is owned by members of the group.

(6)For the purposes of this section and sections 296 and 297, a company is a relevant subsidiary of another company if it is a 75% subsidiary of—

(a)that other company,

(b)a 75% subsidiary of that other company, or

(c)a 75% subsidiary of a 75% subsidiary of that other company, and so on.

291Qualifying partnershipsU.K.

(1)A “qualifying partnership”, in relation to a generating undertaking, means a partnership that operates a relevant generating station whose partners include—

(a)in the case of a generating undertaking that is a company, that company, or

(b)in the case of a generating undertaking that is a group, at least one partner who is not a member of the group and at least one partner who is a member of the group.

(2)For the purposes of subsection (1) of section 282, the qualifying proportion for a qualifying period in relation to a generating undertaking that is a company and a qualifying partnership in relation to that undertaking is the proportion of the partnership’s profits represented by the undertaking’s share of those profits.

(3)For the purposes of that subsection, the qualifying proportion for a qualifying period in relation to a generating undertaking that is a group and a qualifying partnership in relation to that undertaking is the proportion of the partnership’s profits represented by the sum of the shares of those profits of each partner that is a member of the undertaking.

(4)Part 17 of CTA 2009 (partnerships) applies for the purposes of this section as it applies for the purposes of corporation tax.

292Qualifying joint venturesU.K.

(1)For the purposes of this Part a company (“C”) is a “qualifying joint venture” if—

(a)C is not a member of a group other than a group of which it is the principal member, and

(b)there are five or fewer persons who between them—

(i)hold 75% or more of C’s ordinary share capital, or

(ii)in a case where C does not have ordinary share capital, are beneficially entitled to 75% or more of C's profits available for distribution to equity holders of C.

(2)In determining whether there are five or fewer such persons as are mentioned in subsection (1)(b), the members of a group are treated as if they were a single company.

(3)A company (“P”) that is not a member of a group is a participant in a qualifying joint venture (“V”) if—

(a)P holds 10% or more of V’s ordinary share capital, or

(b)in a case where V does not have ordinary share capital, P is beneficially entitled to 10% or more of V's profits available for distribution to equity holders of V.

(4)A group of companies is a participant in a qualifying joint venture (“V”) if—

(a)a member of that group, or two or more members between them, hold 10% or more of V’s ordinary share capital, or

(b)in a case where V does not have ordinary share capital, a member of the group is, or two or more members between them are, beneficially entitled to 10% or more of V's profits available for distribution to equity holders of V.

(5)Where a participant in a qualifying joint venture is not a generating undertaking, the participant is to be treated as a generating undertaking for the purposes of this Part.

Back to top

Options/Help

Print Options

You have chosen to open The Whole Act

The Whole Act you have selected contains over 200 provisions and might take some time to download. You may also experience some issues with your browser, such as an alert box that a script is taking a long time to run.

Would you like to continue?

You have chosen to open The Whole Act as a PDF

The Whole Act you have selected contains over 200 provisions and might take some time to download.

Would you like to continue?

You have chosen to open The Whole Act without Schedules

The Whole Act without Schedules you have selected contains over 200 provisions and might take some time to download. You may also experience some issues with your browser, such as an alert box that a script is taking a long time to run.

Would you like to continue?

You have chosen to open The Whole Act without Schedules as a PDF

The Whole Act without Schedules you have selected contains over 200 provisions and might take some time to download.

Would you like to continue?

You have chosen to open the Whole Act

The Whole Act you have selected contains over 200 provisions and might take some time to download. You may also experience some issues with your browser, such as an alert box that a script is taking a long time to run.

Would you like to continue?

You have chosen to open the Whole Act without Schedules

The Whole Act without Schedules you have selected contains over 200 provisions and might take some time to download. You may also experience some issues with your browser, such as an alert box that a script is taking a long time to run.

Would you like to continue?

You have chosen to open Schedules only

The Schedules you have selected contains over 200 provisions and might take some time to download. You may also experience some issues with your browser, such as an alert box that a script is taking a long time to run.

Would you like to continue?

Close

Legislation is available in different versions:

Latest Available (revised):The latest available updated version of the legislation incorporating changes made by subsequent legislation and applied by our editorial team. Changes we have not yet applied to the text, can be found in the ‘Changes to Legislation’ area.

Original (As Enacted or Made): The original version of the legislation as it stood when it was enacted or made. No changes have been applied to the text.

Close

See additional information alongside the content

Geographical Extent: Indicates the geographical area that this provision applies to. For further information see ‘Frequently Asked Questions’.

Show Timeline of Changes: See how this legislation has or could change over time. Turning this feature on will show extra navigation options to go to these specific points in time. Return to the latest available version by using the controls above in the What Version box.

Close

Opening Options

Different options to open legislation in order to view more content on screen at once

Close

More Resources

Access essential accompanying documents and information for this legislation item from this tab. Dependent on the legislation item being viewed this may include:

  • the original print PDF of the as enacted version that was used for the print copy
  • lists of changes made by and/or affecting this legislation item
  • confers power and blanket amendment details
  • all formats of all associated documents
  • correction slips
  • links to related legislation and further information resources
Close

Timeline of Changes

This timeline shows the different points in time where a change occurred. The dates will coincide with the earliest date on which the change (e.g an insertion, a repeal or a substitution) that was applied came into force. The first date in the timeline will usually be the earliest date when the provision came into force. In some cases the first date is 01/02/1991 (or for Northern Ireland legislation 01/01/2006). This date is our basedate. No versions before this date are available. For further information see the Editorial Practice Guide and Glossary under Help.

Close

More Resources

Use this menu to access essential accompanying documents and information for this legislation item. Dependent on the legislation item being viewed this may include:

  • the original print PDF of the as enacted version that was used for the print copy
  • correction slips

Click 'View More' or select 'More Resources' tab for additional information including:

  • lists of changes made by and/or affecting this legislation item
  • confers power and blanket amendment details
  • all formats of all associated documents
  • links to related legislation and further information resources