SCHEDULES
F1SCHEDULE A1 Application of taper relief
F2Qualifying shareholdings in joint venture companies
Sch. A1 para. 23 and cross-heading inserted (with effect in accordance with s. 67(7) of the amending Act) by Finance Act 2000 (c. 17), s. 67(6)
23
1
This Schedule has effect subject to the following provisions where a company (“the investing company”) has a qualifying shareholding in a joint venture company.
2
For the purposes of F7this Schedule a company is a “joint venture company” if, and only if—
a
it is a trading company or the holding company of a trading group, and
b
75% or more of its ordinary share capital (in aggregate) is held by not more than five F4persons.
For the purposes of paragraph (b) above the shareholdings of members of a group of companies shall be treated as held by a single company.
3
For the purposes of F7this Schedule a company has a “qualifying shareholding” in a joint venture company if—
a
it holds F510% or more of the ordinary share capital of the joint venture company, or
b
it is a member of a group of companies, it holds ordinary share capital of the joint venture company and the members of the group between them hold F510% or more of that share capital.
4
For the purpose of determining whether the investing company is a trading company—
a
any holding by it 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 the holding company of a trading group, of the activities of that group.
F8. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
F95
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6
For the purpose of determining whether a group of companies is 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 such a qualifying shareholding shall be treated as carrying on an appropriate proportion of the activities—
i
of the joint venture company, or
ii
where the joint venture company is the holding company of a trading group, of that group.
This sub-paragraph does not apply if the joint venture company is a member of the group.
7
In sub-paragraphs (4)(b)F10... and (6)(b) above “an appropriate proportion” means a proportion corresponding to the percentage of the ordinary share capital of the joint venture company held by the investing company or, as the case may be, by the group member concerned.
F67A
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).
F38
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F129
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F1110
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Sch. A1 inserted (with effect in accordance with s. 121(4) of the amending Act) by Finance Act 1998 (c. 36), s. 121(2), Sch. 20