Land and Buildings Transaction Tax (Scotland) Act 2013 section Schedule 10, paragraph 48

Disregarding certain Corporation Tax Act provisions when testing subsidiary status

Schedule 10, paragraph 48 specifies that certain provisions of the Corporation Tax Act 2010 relating to option arrangements and their effect on profit and asset entitlements are to be ignored when determining whether one company is a 75% subsidiary of another for LBTT group relief purposes.

• When testing whether a company qualifies as a 75% subsidiary under paragraph 44, certain Corporation Tax Act 2010 provisions must be disregarded.
• The provisions being switched off relate to option arrangements and their impact on how a company's entitlement to profits and assets is calculated.
• Specifically, sections 171(1)(b) and (3), 173, 174, and 176 to 178 of the Corporation Tax Act 2010 are treated as if they do not exist for this purpose.
• This means the subsidiary tests for profit entitlement and asset entitlement under paragraph 44(b) and (c) are applied on a simpler, straightforward basis without adjustments for option arrangements.