Taxes Consolidation Act 1997 section 10

Connected persons

Section 10 sets out the rules for determining when two persons are treated as "connected" with each other for the purposes of the Tax Acts and the Capital Gains Tax Acts.

• An individual is connected with his or her spouse or civil partner, relatives (brothers, sisters, ancestors and lineal descendants), and the spouses or civil partners of those relatives — with "relative" extended for capital gains tax purposes to include uncles, aunts, nieces and nephews.
• Trustees of a settlement are connected with the settlor, with persons connected with the settlor, and with any close company whose participators include the trustees or a beneficiary of the settlement — where "settlement" is defined very broadly to include any disposition, trust, covenant, agreement, arrangement, or transfer of money or property.
• Business partners are connected with each other and with the spouses, civil partners and relatives of their fellow partners, except in relation to bona fide commercial acquisitions or disposals of partnership assets.
• Companies are connected where the same person or group controls both, where a person controls one and connected persons control the other, and any person who controls a company (alone or with connected persons) is connected with that company — while persons acting together to secure control of, or a holding in, a company are treated as connected with each other.