Taxation (International and Other Provisions) Act 2010

[F1 Determining the worldwide group U.K.

Textual Amendments

F1 Pt. 10: the existing Pt. 10 renumbered as Pt. 11 (except for ss. 375, 376 which are repealed), the existing ss. 372-374, 377-382 renumbered as ss. 499-507 and a new Pt. 10 (ss. 372-498) inserted (with effect in accordance with Sch. 5 para. 25(1)-(3) of the amending Act) by Finance (No. 2) Act 2017 (c. 32), Sch. 5 para. 1, 10(1)(2)(a)(3) (with Sch. 5 paras. 27, 32-34)

473 Meaning of “a worldwide group”, “ultimate parent” etc U.K.

(1) In this Part “a worldwide group” means—

(a) any entity which—

(i) is a relevant entity (see section 474), and

(ii) meets the first or second non-consolidation condition (see subsections (2) and (3)), and

(b) each consolidated subsidiary (if any) of the entity mentioned in paragraph (a).

(2) The first non-consolidation condition is that the entity—

(a) is a member of an IAS group, and

(b) is not a consolidated subsidiary of an entity that—

(i) is a relevant entity, and

(ii) itself meets the first non-consolidation condition.

(3) The second non-consolidation condition is that the entity is not a member of an IAS group.

(4) In this Part—

(a) references to “a member” of a worldwide group are to an entity mentioned in subsection (1)(a) or (b);

(b) references to “the ultimate parent” of a worldwide group are to the entity mentioned in subsection (1)(a);

(c) references to “a single-company worldwide group” are to a worldwide group whose only member is its ultimate parent;

(d) references to “a multi-company worldwide group” are to a worldwide group with two or more members.

(5) In this section “IAS group” means a group within the meaning given by international accounting standards.

474 Interpretation of section 473: “relevant entity” U.K.

(1) In section 473 “relevant entity” means—

(a) a company, or

(b) an entity the shares or other interests in which are listed on a recognised stock exchange and are sufficiently widely held.

(2) Shares or other interests in an entity are “sufficiently widely held” if no participator in the entity holds more than 10% by value of all the shares or other interests in the entity.

Section 454 of CTA 2010 (meaning of participator) applies for the purposes of this subsection.

(3) The following are not relevant entities—

(a) the Crown,

(b) a Minister of the Crown,

(c) a government department,

(d) a Northern Ireland department, or

(e) a foreign sovereign power.

475 Meaning of “non-consolidated subsidiary” and “consolidated subsidiary” U.K.

(1) An entity (“X”) is a “non-consolidated subsidiary” of another entity (“Y”) at any time (“the relevant time”) if—

(a) X is a subsidiary of Y at the relevant time, and

(b) if Y were required at the relevant time to measure its investment in X, it would be required to do so using fair value accounting F2 ....

(2) An entity (“X”) is a “consolidated subsidiary” of another entity (“Y”) at any time if, at that time, X is a subsidiary, but not a non-consolidated subsidiary, of Y.

[F3 (3) In this section “subsidiary” has the meaning given by international accounting standards.]

(4) For the purposes of this section, assume that all entities are subject to international accounting standards.

(5) This section has effect for the purposes of this Part.

Textual Amendments

F2 Words in s. 475(1)(b) omitted (with effect in accordance with Sch. 3 para. 30-36 of the amending Act) by virtue of Finance (No. 2) Act 2023 (c. 30), Sch. 3 para. 19(2)

F3 S. 475(3) substituted (with effect in accordance with Sch. 3 para. 30-36 of the amending Act) by Finance (No. 2) Act 2023 (c. 30), Sch. 3 para. 19(3)

476 Continuity of identity of a worldwide group through time U.K.

(1) This section applies for the purpose of determining whether a group of entities that constitutes a worldwide group at any time (“Time 2”) is the same worldwide group as a group of entities that constitutes a worldwide group at an earlier time (“Time 1”).

(2) The group at Time 2 is the same worldwide group as the group at Time 1 if and only if the entity that is the ultimate parent of the group at Time 2—

(a) was the ultimate parent of the group at Time 1, and

(b) was the ultimate parent of a worldwide group at all times between Time 1 and Time 2.

477 Treatment of stapled entities U.K.

(1) This section applies where two or more entities—

(a) would, apart from this section, each be the ultimate parent of a worldwide group, and

(b) are stapled to each other.

(2) This Part has effect as if—

(a) the entities were consolidated subsidiaries of another entity (the “deemed parent”), and

(b) the deemed parent fell within section 473(1)(a) (conditions for being the ultimate parent of a worldwide group).

(3) For the purpose of this section an entity (“entity A”) is “stapled” to another entity (“entity B”) if, in consequence of the nature of the rights attaching to the shares or other interests in entity A (including any terms or conditions attaching to the right to transfer the interests), it is necessary or advantageous for a person who has, disposes of or acquires shares or other interests in entity A also to have, dispose of or acquire shares or other interests in entity B.

478 Treatment of business combinations U.K.

(1) This section applies where two entities—

(a) would, apart from this section, each be the ultimate parent of a worldwide group, and

(b) are treated under international accounting standards as a single economic entity by reason of being a business combination achieved by contract.

(2) This Part has effect as if—

(a) the two entities were consolidated subsidiaries of another entity (the “deemed parent”), and

(b) the deemed parent fell within section 473(1)(a) (conditions for being the ultimate parent of a worldwide group).

(3) In this section “business combination” has the meaning given by international accounting standards.]