Corporation Tax Act 2009 section 766

Only effective 51% subsidiaries of principal company to be members of group

Section 766 restricts which companies can be members of a group for the purposes of the intangible fixed assets rules, requiring that only effective 51% subsidiaries of the principal company qualify.

• A group of companies for intangible fixed asset purposes consists only of the principal company and its effective 51% subsidiaries.
• Any company that is not an effective 51% subsidiary of the principal company is excluded from the group, even if it would otherwise fall within the corporate structure.
• The definition of "effective 51% subsidiary" is provided separately in section 771 of the Corporation Tax Act 2009.
• This is an additional qualifying condition that applies on top of the basic group definition, specifically for the intangible fixed assets regime.