SCHEDULE 5Enterprise management incentives
Part 3Qualifying companies
Meaning of “qualifying trade”
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(1)
A trade is a qualifying trade if—
(a)
it is carried on wholly or mainly in the United Kingdom,
(b)
it is conducted on a commercial basis and with a view to the realisation of profits, and
(c)
it does not consist (either wholly or as to a substantial part) in the carrying on of excluded activities.
(2)
The carrying on of activities of research and development from which it is intended that a connected qualifying trade will be derived or benefit counts as the carrying on of a qualifying trade.
(3)
But preparing to carry on such activities does not count as preparing to carry on a qualifying trade.
(4)
In sub-paragraph (2) “connected qualifying trade” means a qualifying trade carried on—
(a)
by the company carrying on the activities of research and development, or
(b)
if that company is a member of a group, by any other member of the group.