Taxes Consolidation Act 1997 Schedule 9 paragraph 5

Groups of companies

Schedule 9 paragraph 5 sets out when a change in the ownership of a company within a group is to be disregarded, and when a change in ownership of a parent company is treated as also being a change in ownership of its subsidiaries, for the purposes of sections 401 and 679(4).

• A change in ownership of a company is disregarded if, both before and after the change, it remains a 75 per cent subsidiary of the same parent company.
• This applies even where there has been a change in who directly holds the shares in the subsidiary, provided the ultimate 75 per cent parent relationship is preserved.
• Where a company that has a 75 per cent subsidiary undergoes a change of ownership, that subsidiary is also treated as having changed ownership.
• The deemed change in ownership of the subsidiary does not apply if the change in ownership of the parent is itself disregarded under the first rule.