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Taxation of Chargeable Gains Act 1992, Cross Heading: Treatment of holdings in joint venture companies is up to date with all changes known to be in force on or before 12 November 2024. There are changes that may be brought into force at a future date. Changes that have been made appear in the content and are referenced with annotations.
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Textual Amendments
F1Sch. 7AC inserted (with effect in accordance with s. 44(3)(4) of the amending Act) by Finance Act 2002 (c. 23), Sch. 8 para. 1
23(1)This paragraph applies where a company (“the company”) has a qualifying shareholding in a joint venture company.U.K.
(2)In determining whether the company is a trading company—
(a)its holding of shares in the joint venture company shall be disregarded, and
(b)it shall be treated as carrying on an appropriate proportion—
(i)of the activities of the joint venture company, or
(ii)where the joint venture company is a holding company, of the activities of that company and its 51% subsidiaries.
This sub-paragraph does not apply if the company is a member of a group and the joint venture company is a member of the same group.
(3)In determining whether the company is F2... the holding company of a trading group—
(a)every holding of shares in the joint venture company by a member of the group having a qualifying shareholding in that company shall be disregarded, and
(b)each member of the group having a qualifying shareholding in the joint venture company shall be treated as carrying on an appropriate proportion—
(i)of the activities of the joint venture company, or
(ii)where the joint venture company is a holding company, of the activities of that company and its 51% subsidiaries.
This sub-paragraph does not apply if the joint venture company is a member of the group.
(4)In determining whether the company is the holding company of a trading subgroup—
(a)every holding of shares in the joint venture company by the company and any of its 51% subsidiaries having a qualifying shareholding in the joint venture company shall be disregarded, and
(b)the company and each of its 51% subsidiaries having a qualifying shareholding in the joint venture company shall be treated as carrying on an appropriate proportion—
(i)of the activities of the joint venture company, or
(ii)where the joint venture company is a holding company, of the activities of that company and its 51% subsidiaries.
This sub-paragraph does not apply if the joint venture company is a member of the same group as the company.
(5)In sub-paragraphs (2)(b), (3)(b) and (4)(b) “an appropriate proportion” means a proportion corresponding to the percentage of the ordinary share capital of the joint venture company held by the company concerned.
(6)In this paragraph “shares”, in relation to a joint venture company, includes securities of that company or an interest in shares in or securities of that company.
(7)For the purposes of this paragraph the activities of a joint venture company that is a holding company and its 51% subsidiaries shall be treated as a single business (so that activities are disregarded to the extent that they are intra-group activities or, as the case may be, intra-subgroup activities).]
Textual Amendments
F2Words in Sch. 7AC para. 23(3) omitted (with effect in accordance with s. 27(6) of the amending Act) by virtue of Finance (No. 2) Act 2017 (c. 32), s. 27(2)(e)
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