Income Tax Act 2007 Schedule 2 paragraph 42

The control and independence requirement

Section 42 provides transitional rules that modify how the control and independence requirement in section 139 applies to shares depending on when they were issued.

• For shares issued before 6 April 2007, the control requirement applies without reference to ownership "of the company," broadening its scope slightly.
• For shares issued before 21 March 2000, substantially different control and independence tests apply: the company must not control another company or have a 51% subsidiary, and must not itself be controlled by or be a 51% subsidiary of another company.
• Shares issued between 6 April 1998 and 21 March 2000 that had EIS relief or Schedule 5B TCGA 1992 relief immediately before 21 March 2000 are treated as though they were issued on or after 21 March 2000, meaning the newer rules apply to them.
• Section 139 does not apply at all to shares issued before 6 April 1998, so those shares face no control and independence requirement.