Capital Allowances Act 2001

49 Whether company is a member of a large or medium-sized group U.K.

(1) Use this section to decide whether, for the purposes of section 47, a company is—

(a) a member of a large group, or

(b) a member of a large or medium-sized group.

(2) Subject to subsection (4), a company is a member of a large group at the time when any expenditure is incurred if—

(a) it is at that time the parent undertaking of a group which does not qualify as small or medium-sized in relation to the financial year of the parent undertaking in which that time falls, or

(b) it is at that time a subsidiary undertaking in relation to the parent undertaking of such a group.

(3) Subject to subsection (4), a company is a member of a large or medium-sized group at the time when any expenditure is incurred if—

(a) it is at that time the parent undertaking of a group which does not qualify as small in relation to the financial year of the parent undertaking in which that time falls, or

(b) it is at that time a subsidiary undertaking in relation to the parent undertaking of such a group.

(4) If, at the time when any expenditure is incurred by a company, any arrangements exist which are such that, had effect been given to them immediately before that time, the company or a successor of the company—

(a) would, at that time, have been a member of a large group, or

(b) would, at that time, have been a member of a large or medium-sized group,

the company incurring the expenditure is to be treated as a member of a large group or (as the case may be) a large or medium-sized group at that time.

(5) For the purposes of subsections (2) and (3), the question whether—

(a) a group qualifies as small or medium-sized, or

(b) a group qualifies as small,

is to be decided by reference to the relevant companies legislation (but reading references in that legislation to a parent company as references to a parent undertaking).

(6) In subsection (5) “the relevant companies legislation” means [F1 sections 383 and 466 of the Companies Act 2006.]

(7) For the purposes of subsection (4) a company is the successor of another if—

(a) it carries on a trade which, in whole or in part, the other company has ceased to carry on, and

(b) the circumstances are such that section 343 of ICTA (company reconstructions without a change of ownership) applies in relation to the two companies as the predecessor and the successor within the meaning of that section,

and “arrangements” means arrangements of any kind (whether or not in writing or legally enforceable).

[F2 (8) In this section—

• “financial year” and “group” have the same meaning as in Part 15 of the Companies Act 2006;

• “parent undertaking” and “subsidiary undertaking” have the same meaning as in section 1162 of that Act.]

Textual Amendments

F1 Words in s. 49(6) substituted (6.4.2008) by The Companies Act 2006 (Consequential Amendments) (Taxes and National Insurance) Order 2008 (S.I. 2008/954), arts. 1(1), 30(2) (with art. 4)

F2 S. 49(8) substituted (6.4.2008) by The Companies Act 2006 (Consequential Amendments) (Taxes and National Insurance) Order 2008 (S.I. 2008/954), arts. 1(1), 30(3) (with art. 4)