CHAPTER 2

Business relief

90 Interpretation (Chapter 2)

Summary

This section defines the terms used in this Chapter.

Details

(1) “agricultural property” has the meaning assigned to it by section 89;

“associated company” has the meaning assigned to it by section 16(1)(b) of the Companies (Amendment) Act 1986. The term “associated company” means an interest of a company holding a qualifying capital interest equal to 20% or more of all such interests in an undertaking that is not strictly an undertaking relating to a subsidiary company;

“business” includes a business carried on in the exercise of a profession or vocation, but does not include a business carried on otherwise than for gain;

“excepted asset” is construed in accordance with section 100;

“full-time working officer or employee”, in relation to one or more companies, means any officer or employee who devotes substantially the whole of his/her time to the service of that company, or those companies taken together, in a managerial or technical capacity;

“holding company” and “subsidiary” have the meanings assigned to them, respectively, by section 155 of the Companies Act 1963. Section 155(4) provides that a company shall be deemed to be another company’s holding company if that other company is its subsidiary. Section 155(1) provides that a company is a subsidiary of a holding company if the holding company:

• is a member of and controls the board of directors,
• owns more than half in nominal value of the equity share capital, or
• owns more than half of the nominal value of the voting shares;

“quoted”, in relation to any shares or securities, means quoted on a recognised stock exchange and “unquoted”, in relation to any shares or securities, means not so quoted (a recognised stock exchange is a stock exchange where shares in a public company can be bought and sold);

“relevant business property” is construed in accordance with section 93.

(2) A reference in Chapter 2 to a gift is to be construed as a reference to a taxable gift (see section 6) and a reference to an inheritance is to be construed as a reference to a taxable inheritance (see section 11).

(3) A company and all its subsidiaries and any associated company of that company or of any of its subsidiaries and any subsidiary of such an associated company are members of a group for the purpose of Chapter 2.

(4) Any references to a donee or successor in Chapter 2 includes a reference to the transferee referred to in section 32(2) – see note on that subsection.

Relevant Date: Finance Act 2015