Corporation Tax Act 2010 section 185

"Trading company" and "holding company"

Section 185 defines the terms "trading company" and "holding company" as used in the group relief provisions of Part 5 of the Corporation Tax Act 2010.

• A "trading company" is one whose business consists wholly or mainly of carrying on one or more trades.
• A "holding company" is one whose business consists wholly or mainly of holding shares or securities in qualifying subsidiaries.
• To qualify, the subsidiaries held by a holding company must be 90% subsidiaries and must themselves be trading companies.
• The "wholly or mainly" test means that more than 50% of the company's business activities must fall within the relevant category.