Corporation Tax Act 2010 section 446

Particular types of quoted company

Section 446 sets out the conditions under which certain quoted companies can avoid being treated as close companies, based on the level of public shareholding and the concentration of voting power among principal members.

• A quoted company is not treated as close if at least 35% of its voting shares are unconditionally held by the public and those shares have been dealt in and listed on a recognised stock exchange within the preceding 12 months.
• This exemption does not apply if the company's principal members together hold more than 85% of the voting power.
• A principal member is generally someone holding more than 5% of the voting power, but if more than five people qualify, only those with the five greatest shareholdings count (with tie-breaking rules where percentages are equal).
• Shares for this purpose include stock but exclude fixed-rate dividend shares, and voting power attributed under the connected persons rules in section 451 must be taken into account.