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Taxes Consolidation Act, 1997 (Number 39 of 1997)

616 Groups of companies: interpretation.

[CTA76 s129(1) to (6)(b); FA90 s58]

(1) For the purposes of this section and of the following sections [1]>of this Part<[1] [1]>of this Chapter<[1]

[2]>

(a) references to a company shall, subject to section 621(1), apply only to a company, as limited by subsection (2), which is resident in the State;

(b) a principal company and all its 75 per cent subsidiaries shall form a group, and where a principal company is a member of a group as being itself a 75 per cent subsidiary that group shall comprise all its 75 per cent subsidiaries;

(c) principal company” means a company of which another company is a 75 per cent subsidiary;

<[2]

[2]>

[5]>

(a) subject to section 621(1), a reference to a company or companies shall apply only to a company or companies, as limited by subsection (2), being a company or, as the case may be, companies—

(i) where the reference is in this section, which, by virtue of the law of a Member State of the European Communities, is or are resident for the purposes of tax in such a Member State, and for this purpose “tax”, in relation to a Member State of the European Communities other than the State, means any tax imposed in the Member State which corresponds to corporation tax in the State, and

(ii) where the reference is in the following sections of this Chapter, which is or are resident in the State,

and references to a member or members of a group of companies shall be construed accordingly;

<[5]

[5]>

(a) subject to [15]>section 621(1)<[15][15]>sections 617(5), 621(1) and 623(7)<[15], a reference to a company or companies shall apply only to a company or companies, as limited by subsection (2), being a company or, as the case may be, companies which, by virtue of the law of a [9]>Member State of the European Communities<[9] [9]>relevant Member State<[9], is or are resident for the purposes of tax in such a Member State, and for this purpose “tax”, in relation to a [9]>Member State of the European Communities<[9] [9]>relevant Member State<[9] other than the State, means any tax imposed in the Member State which corresponds to corporation tax in the State, and references to a member or members of a group of companies shall be construed accordingly;

<[5]

(b) a company is an effective 75 per cent subsidiary of another company (in this paragraph referred to as “the parent”) at any time if at that time—

(i) the company is a 75 per cent subsidiary (within the meaning of section 9) of the parent,

(ii) the parent is beneficially entitled to not less than 75 per cent of any profits available for distribution to equity holders of the company, and

(iii) the parent would be beneficially entitled to not less than 75 per cent of the assets of the company available for distribution to its equity holders on a winding up,

and sections 413 to 419 shall apply for the purposes of this paragraph as they apply for the purposes of Chapter 5 of Part 12;

(bb) a principal company and all its effective 75 per cent subsidiaries shall form a group, and where a principal company is a member of a group as being itself an effective 75 per cent subsidiary that group shall comprise all its effective 75 per ent subsidiaries;

(c) principal company” means a company of which another company is an effective 75 per cent subsidiary;

<[2]

(d) in applying the definition of “75 per cent subsidiary” in section 9, any share capital of a registered industrial and provident society shall be treated as ordinary share capital;

(e) “group” and “subsidiary” shall be construed with any necessary modifications where applied to a company incorporated under the law of a country outside the [6]>State.<[6][6]>State;<[6]

[7]>

(f) an asset is a “chargeable asset” in relation to a company at any time if, were the asset to be disposed of by the company at that time, any gain accruing to the company would be a chargeable gain.

<[7]

[14]>

(g) Notwithstanding paragraph (b)

(i) a company (in this paragraph referred to as the “first-mentioned company”) shall be an effective 75 per cent subsidiary of the National Asset Management Agency where that Agency directly owns any part of the ordinary share capital of that company, and

(ii) any other company which is an effective 75 per cent subsidiary of the first-mentioned company shall be an effective 75 per cent subsidiary of the National Asset Management Agency.

<[14]

(2) For the purposes of this section and of the following sections of this Part, references to a company shall apply only to—

(a) a company within the meaning of the [16]>Companies Act, 1963<[16][16]>Companies Act 2014<[16],

(b) a company constituted under any other Act or a charter or letters patent or [8]>(although resident in the State)<[8] formed under the law of a country or territory outside the State,

(c) a registered industrial and provident society, being a society within the meaning of section 698, and

(d) a building society incorporated or deemed by virtue of section 124(2) of the Building Societies Act, 1989, to be incorporated under that Act.

(3) For the purposes of this section and of the following sections of this Part, a group shall remain the same group so long as the same company remains the principal company of the group and, if at any time the principal company of a group becomes [3]>a 75 per cent subsidiary<[3] [3]>an effective 75 per cent subsidiary<[3] of another company, the group of which it was the principal company before that time shall be regarded as the same as the group of which that other company is the principal company or [3]>a 75 per cent subsidiary<[3] [3]>an effective 75 per cent subsidiary<[3], and the question whether or not a company has ceased to be a member of a group shall be determined accordingly.

[12]>

(3A) Where at any time the principal company of a group—

(a) (i) becomes an SE by reason of being the acquiring company in the formation of an SE by merger by acquisition (in accordance with Articles 2(1), 17(2)(a) and 29(1) of the SE Regulation (within the meaning of section 630)),

(ii) becomes a subsidiary of a holding SE (formed in accordance with Article 2(2) of that Regulation), or

(iii) is transformed into an SE (in accordance with Article 2(4) of that Regulation),

or

(b) becomes an SCE in the course of a merger in accordance with Article 2 of the SCE Regulation (within the meaning of section 630),

then the group of which it was the principal company before that time and any group of which the SE, or as the case may be the SCE, is a member on formation shall be regarded as the same, and the question of whether or not a company has ceased to be a member of a group shall be determined accordingly.

<[12]

(4) For the purposes of this section and of the following sections of this Part, the passing of a resolution or the making of an order or any other act for the winding up of a company shall not be regarded as the occasion of that company or of any [4]>75 per cent subsidiary<[4] [4]> effective 75 per cent subsidiary<[4] of that company ceasing to be a member of a group of companies.

(5)(a) The following sections of this Part, except in so far as they relate to the recovery of tax, shall also apply in relation to bodies from time to time established by or under any enactment for the carrying on of any industry or part of an industry, or of any undertaking, under national ownership or control as if—

(i) such bodies were companies within the meaning of those sections,

(ii) any such bodies charged with related functions and subsidiaries of any of them formed a group, and

(iii) any 2 or more such bodies charged at different times with the same or related functions were members of a group.

(b) Paragraph (a) shall apply subject to any enactment by virtue of which property, rights, liabilities or activities of one such body mentioned in that paragraph are to be treated for corporation tax as those of another such body.

(6) For the purposes of this Part—

(a) section 557 and all other provisions for apportioning on a part disposal expenditure which is deductible in computing a gain shall be operated before the operation of and without regard to—

(i) section 617(1), and

(ii) any other enactment making an adjustment to secure that neither a gain nor a loss occurs on a disposal;

(b) section 589 shall not apply where the transfer is a disposal to which section 617(1) applies.

[10]>

(7) For the purposes of this Part—

EEA Agreement” means the Agreement on the European Economic Area signed at Oporto on 2 May 1992, as adjusted by the Protocol signed at Brussels on 17 March 1993;

EEA State” means a state which is a contracting party to the EEA Agreement;

“relevant Member State” means—

(a) a Member State of the European Communities, or

(b) not being such a Member State, an EEA State which is a territory with the government of which arrangements having the force of law by virtue of [11]>section 826<[11] [13]>[11]>section 826(1)(a)<[11]<[13][13]> section 826(1)<[13] have been made;

<[10]

[1]

[-] [+]

Substituted by FA99 s56(1)(a)(i). Applies as respects accounting periods ending on or after the 1st day of July, 1998.

[2]

[-] [+]

Substituted by FA99 s56(1)(a)(ii). Applies as respects accounting periods ending on or after the 1st day of July, 1998.

[3]

[-] [+] [-] [+]

Substituted by FA99 s56(1)(b)(i). Applies in any other case as on and from the 11th day of February, 1999.

[4]

[-] [+]

Substituted by FA99 s56(1)(b)(ii). Applies in any other case as on and from the 11th day of February, 1999.

[5]

[-] [+]

Substituted by FA01 s38(1)(b)(i)(I).

[6]

[-] [+]

Substituted by FA01 s38(1)(b)(i)(II).

[7]

[+]

Inserted by FA01 s38(1)(b)(i)(III).

[8]

[-]

Deleted by FA01 s38(1)(b)(ii).

[9]

[-] [+] [-] [+]

Substituted by FA02 s36(b)(i).

[10]

[+]

Inserted by FA02 s36(b)(ii).

[11]

[-] [+]

Substituted by FA05 sched6(1)(j). Applies as on and from 25 March 2005

[12]

[+]

Inserted by FA06 s60(c).

[13]

[-] [+]

Substituted by FA07 sched2(1)(s). Has effect as on and from 2 April 2007

[14]

[+]

Inserted by the National Asset Management Agency Act 2009 Sched 3 part 10.

[15]

[-] [+]

Substituted by FA17 s31(a). Comes into operation on 1 January 2018.

[16]

[-] [+]

Substituted by FA17 sched2(1)(ae). Deemed to have come into operation on 1 June 2015.