Corporation Tax Act 2010 section 356OT

Related parties

Section 356OT defines when two persons are considered "related parties" for the purposes of the buildings and structures allowances provisions, setting out three alternative tests based on consolidated accounting, participation, or investment.

• Two persons are related if they are consolidated for accounting purposes, if the participation condition is met, or if the 25% investment condition is met between them
• Consolidation for accounting purposes means their financial results are required to be, would be but for an exemption, or are in fact included in group accounts under the Companies Act 2006 or equivalent overseas legislation
• The participation condition is met where, within a six-month window, one party participates directly or indirectly in the management, control or capital of the other, or a common person participates in both
• The 25% investment condition is met where one party holds a 25% investment in the other, or a third person holds a 25% investment in both of them