Finance Act, 1996
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Amendment of section 13 A (restriction of relief where amounts raised exceed permitted maximum) of Finance Act, 1984. |
19.—(1) Section 13A (inserted by the Finance Act, 1989 ) of the Finance Act, 1984 , is hereby amended— | |
(a) in subsection (1)— | ||
(i) as respects eligible shares issued on or after the 23rd day of January, 1996, by the substitution of “the issue of eligible shares on or after the 23rd day of January, 1996 (hereafter in this section referred to as the ‘relevant issue’)” for “the issue of eligible shares (hereafter in this section referred to as the ‘relevant issue’) on any day falling on or after the 6th day of May, 1993,”, and | ||
(ii) as on and from the passing of the Finance Act, 1996, by the addition of the following proviso: | ||
“Provided that, in the case of a company which, or whose qualifying subsidiary, either carries on or intends to carry on a qualifying trading operation as is mentioned in subparagraph (iib) (inserted by the Finance Act, 1996) of paragraph (a) of subsection (2) of section 16, this section shall apply and have effect, in relation to that company and money raised or intended to be raised by it under the provisions of this Chapter by virtue of clause (II) of the aforesaid subparagraph (iib), as if in the foregoing formula and in the formula in subsection (1A) (as amended by the Finance Act, 1996) ‘£100,000’ were substituted for ‘£1,000,000’ in each place where it occurs.”, | ||
and | ||
(b) by the substitution of the following subsections for subsections (1A) and (1B) (inserted by the Finance Act, 1991 ): | ||
“(1A) Where a company raises any amount through a relevant issue and that company is associated (within the meaning of this section) with one or more other companies then, as respects that company, relief shall not be given in respect of the amount so raised over the amount determined by the formula— | ||
£1,000,000—B | ||
where— | ||
B is an amount equal to so much, as does not exceed £1,000,000, of the aggregate of all amounts raised through the issue of eligible shares at any time before or on the date of the relevant issue by all of the companies (including that company) which are associated within the meaning of this section. | ||
(1B) In this section, a company is associated with another company where it could reasonably be considered that— | ||
(a) (i) both companies act in pursuit of a common purpose, or | ||
(ii) any person or any group of persons or groups of persons having a reasonable commonality of identity have or had the means or power, either directly or indirectly, to determine the trading operations carried on or to be carried on by both companies, or | ||
(b) both companies are under the control of any person or group of persons or groups of persons having a reasonable commonality of identity: | ||
Provided that, for the purposes of this section, a company shall not be considered as associated with another company only by reason of the fact that a subscription for eligible shares in both companies is made by a person or persons having the management of an investment fund designated under section 27 as nominee for any person, group of persons or groups of persons.”. | ||
(2) As respects eligible shares issued on or after the 28th day of March, 1996, section 13A (as amended by subsection (1)) of the Finance Act, 1984 , is hereby further amended by the substitution of the following subsections for subsection (1B) (inserted by the said subsection (1)): | ||
“(1B) In this section, a company is associated with another company where— | ||
(a) in the case of that company, or a company which is, or was at any time, its qualifying subsidiary, and | ||
(b) that other company, or a company which is, or was at any time, its qualifying subsidiary, | ||
it could reasonably be considered that— | ||
(i) both companies act in pursuit of a common purpose, or | ||
(ii) any person or any group of persons or groups of persons having a reasonable commonality of identity have or had the means or power, either directly or indirectly, to determine the trading operations carried on or to be carried on by both companies, or | ||
(iii) both companies are under the control of any person or group of persons or groups of persons having a reasonable commonality of identity: | ||
Provided that, for the purposes of this section, a company shall not be considered as associated with another company only by reason of the fact that a subscription for eligible shares in both companies is made by a person or persons having the management of an investment fund designated under section 27 as nominee for any person, group of persons or groups of persons. | ||
(1C) In this section, ‘qualifying subsidiary’, in relation to a company, has the same meaning as it has for the purpose of section 15.”. |