ba

shares in a company which is subject to an employee-ownership trust, or

3

But a company is not a close company for the purposes of sub-paragraph (2) if it is subject to an employee-ownership trust.

4

A company (“C”) is “subject to an employee-ownership trust” if—

a

C meets the trading requirement set out in section 312D,

b

C meets the indirect employee-ownership requirement,

c

neither C, nor any other company which is a member of the same group of companies as C, is a service company, and

d

C is not under the control of another company (ignoring for this purpose another company acting in its capacity as the trustee of the settlement by virtue of which C meets the indirect employee-ownership requirement).

5

Section 312E (the indirect employee-ownership requirement) applies for the purposes of sub-paragraph (4), subject to the following modifications—

a

subsection (3) of that section has effect as if—

i

the words “during the qualifying period” were omitted, and

ii

in paragraph (a) for “10 December 2013” there were substituted “ 1 October 2014 ”, and

b

subsection (4) has effect as if for paragraph (b) there were substituted—

b

section 236L of that Act applies as if the reference in subsection (1)(c) of that section to the period of 12 months ending with the time in question were a reference to any time on or after 1 October 2014.

6

Section 312G (meaning of “service company”) applies for the purposes of sub-paragraph (4)(c), subject to the following modifications—

a

in subsection (3)(b), the reference to the company which makes the payment is to be read as a reference to C,

b

in subsection (4)(a), the reference to the time the payment is made is to be read as a reference to any time, and

c

in subsection (4)(b), the reference to any time before the time the payment is made is to be read as a reference to any time.