Income Tax (Trading and Other Income) Act 2005 section 608T

Related persons

Section 608T defines what it means for two persons to be "related" for the purposes of the exemption for business activities undertaken within a territory of residence under section 608K.

• Two persons are related if, at a given time, they are in the same control group, one holds a 25% investment in the other, or a third person holds a 25% investment in both.
• Two persons are also related if, within a six-month window before or after a given time, one directly or indirectly participates in the management, control or capital of the other, or a third person so participates in both.
• The definitions of "control group" and "25% investment" are drawn from sections 608S and 608U respectively, while "direct or indirect participation" is defined in section 608V.
• This definition is relevant when determining whether the section 608K exemption from tax on offshore receipts in respect of intangible property applies.