Corporation Tax Act 2010

1085 Conditions to be met if the distributing company is a 75% subsidiary

(1) Condition L is that the group (or, if more than one, the largest group) to which the distributing company belongs at the time of the distribution must be a trading group.

(2) Condition M is that the distribution (“the original distribution”) must be followed by one or more other distributions (“further distributions”) falling within section 1076(a) or 1077(1)(a)(ii) which—

(a) are exempt distributions, and

(b) comply with subsection (3).

(3) To comply with this subsection a further distribution must result in members of the holding company of the group (or, if more than one, the largest group) to which the distributing company belonged at the time of the original distribution becoming members of—

(a) the transferee company or each transferee company to which a trade was transferred by the distributing company,

(b) the subsidiary or each subsidiary whose shares were transferred by the distributing company, or

(c) a company (other than the holding company) of which the company or companies mentioned in paragraph (a) or (b) are 75% subsidiaries.