Corporation Tax Act 2010 section 1011

Meaning of "associated company" in section 1009

Section 1011 defines what "associated company" means for the purposes of the exclusion from distribution treatment of securities that reflect dividends on certain shares under section 1009.

• Two companies are associated if one controls the other, or both are controlled by the same person or persons.
• Control means having the power to direct a company's affairs through shareholdings, voting power, or powers granted by constitutional or governing documents.
• Control can be exercised indirectly, for example through holding shares or voting power in another company rather than the company in question.
• Shares held as trading stock are disregarded when assessing control, unless they form part of an insurance company's long-term insurance fund.