VCM74320 - Share loss relief: individual and corporate claimants: individual claimants: type of company invested in: qualifying trading company: introduction
ITA07/S134 imposes three ‘high level’ conditions (A - C)* each of which must be met at the date of disposal of the shares in order for the company which issued the shares to be a qualifying trading company. Each of these high level conditions has two or more subsidiary requirements some or all of which must be met in order for the high level condition to be met. The following table introduces the high level conditions and their subsidiary requirements and provides links to more detailed guidance.
High level condition A: subsidiary requirements to be met at time of, or prior to, disposal of shares
All four subsidiary requirements must be met
Subsidiary requirement |
Statute (ITA 2007) |
Guidance |
|---|---|---|
The trading requirement |
S137 |
|
The control and independence requirement |
S139 |
|
The qualifying subsidiaries requirement |
S140 |
|
The property managing subsidiaries requirement |
S141 |
High level condition B: subsidiary requirements in A also to be met throughout a specified period
Subsidiary requirements are alternative to one anothe
Subsidiary requirement |
Statute (ITA 2007) |
Guidance |
|---|---|---|
subsidiary requirements in A to be met for continuous period of six years |
S134(3)(a) |
|
subsidiary requirements in A to be met for less than six years providing previous activities are limited |
S134(3)(b) |
High level condition C: Upper limit on size of company issuing shares
Both subsidiary requirements must be met
|
Subsidiary requirement |
Statute (ITA 2007) |
Guidance |
|
Gross assets requirement met before and after share issue |
S134(4)(a) & S142 |
|
|
Unquoted status requirement met at the relevant time |
S134(4)(b) & S143 |
*Condition D was repealed by s38(1)(a) Finance Act 2020 with effect in relation to disposals made on or after 24 January 2019.