Corporation Tax Act 2010

712 Meaning of “a major change in the nature or conduct of a trade or business” U.K.

(1) This section applies for the purposes of section 711(4).

(2) “A major change in the nature or conduct of a trade or business” includes—

(a) a major change in the type of property dealt in, or services or facilities provided, in the trade or business,

(b) a major change in customers, outlets or markets of the trade or business,

(c) a change by which the company ceases to be a trading company and becomes an investment company,

(d) a change by which the company ceases to be an investment company and becomes a trading company, and

(e) if the company is an investment company, a major change in the nature of the investments held by the company.

(3) Any reference in subsection (2) to a change includes a change which is achieved gradually as a result of a series of transfers.

(4) In this section “trading company” means a company whose business consists wholly or mainly in the carrying on of a trade or trades.

(5) For the purposes of this section, a company is an investment company if—

(a) its business consists wholly or mainly in the making of investments, and

(b) the principal part of its income is derived from investments.

(6) But a company is not an investment company if its business consists wholly or mainly in the holding of shares or securities of companies—

(a) which are its 90% subsidiaries, and

(b) which are trading companies.