What is a UK group company under section 492 of TIOPA 2010?

Under section 492, a UK group company is a company that satisfies two conditions simultaneously during a worldwide group's period of account: it must be within the charge to UK corporation tax, and it must be a member of the worldwide group at that same time. Both conditions must be met at the same point.

Which companies are within the charge to UK corporation tax for the purposes of section 492?

Companies within the charge to UK corporation tax typically include UK-resident companies and non-resident companies carrying on a trade in the United Kingdom through a permanent establishment. A company incorporated and operating entirely outside the UK with no permanent establishment would not satisfy this condition.

What happens if a company joins or leaves the worldwide group partway through a period of account?

If a company joins or leaves the worldwide group partway through a period of account, it is only treated as a UK group company for the portion of the period during which both conditions are met simultaneously. It must be within the charge to corporation tax and a group member at the same time.

Can a non-UK resident company be a UK group company under section 492?

Yes, a non-UK resident company can be a UK group company if it carries on a trade through a UK permanent establishment, bringing it within the charge to UK corporation tax, and it is also a member of the worldwide group at the same time during the relevant period of account.

Taxation (International and Other Provisions) Act 2010 section 492

Meaning of "UK group company"

Section 492 defines what is meant by a "UK group company" for the purposes of the corporate interest restriction rules.

A "UK group company" is a defined term used throughout the corporate interest restriction provisions.
The company must be within the charge to UK corporation tax at the relevant time.
The company must also be a member of the worldwide group at that same time.
Both conditions must be met simultaneously during the period of account in question.

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