Taxation of Chargeable Gains Act 1992 section 165A

Meaning of "holding company", "trading company" and "trading group"

Section 165A defines the terms "holding company", "trading company" and "trading group" for the purposes of the gift relief provisions under section 165.

• A holding company is one with at least one 51% subsidiary; a trading company is one whose activities are substantially all trading activities, including preparatory activities and acquisitions of trading interests
• A trading group is a group whose members' combined activities do not include non-trading activities to a substantial extent, with intra-group transactions disregarded
• Joint venture companies — where a company or group member holds a qualifying shareholding of 10% or more — are factored in by attributing an appropriate proportion of the joint venture's activities to the shareholding company
• Preparatory activities such as acquiring a trade or a significant shareholding in another trading company only count as trading activities if the acquisition or trade commencement happens as soon as reasonably practicable