Revenue Note for Guidance
This section sets out the circumstances in which a person is to be treated as connected with a company for the purposes of this Chapter. In general, a person is connected with a company if that person has more than a 30 per cent interest in the capital, the voting power or the assets of the company. In determining whether a person is connected with a company, the person is treated as having all the rights and powers of that persons associates. In addition, a person is treated as entitled to acquire anything which that person is entitled to acquire at a future date or will at a future date be entitled to acquire.
(1) A person is connected with a company where any of the following conditions are satisfied as regards that person’s own rights and interests or the combined rights and interests of that person and the associates of that person —
(2) In determining whether a person has a 30 per cent interest in the total of a company’s issued share capital and loan capital, the person’s interest in the loan capital of the company is ignored if the loan was acquired by that person in the ordinary course of a business which includes the lending of money. This applies provided the person takes no part in the management or conduct of the company.
(3) References to the loan capital of a company are references to any debt incurred by the company for —
(4) A person is entitled to acquire anything which —
A person is treated as having the rights and powers of that person’s associates in addition to that person’s own rights and powers.
Relevant Date: Finance Act 2021