Section 707 — Corporation Tax Act 2010: Meaning of “control”

Meaning of “control” 707 1 This section applies for the purposes of this Chapter.

2 A person (“P”) is treated as having control of a company (“C”) if P—

a exercises, b is able to exercise, or c is entitled to acquire, direct or indirect control over C's affairs.

3 In particular, P is treated as having control of C if P possesses or is entitled to acquire—

a 50% of the share capital or issued share capital of C, b 50% of the voting power in C, c so much of the issued share capital of C as would, on the assumption that the whole of the income of C were distributed among the participators, entitle P to receive the greater part of the amount so distributed, or d such rights as would entitle P, in the event of the winding up of C or in any other circumstances, to receive the greater part of the assets of C which would then be available for distribution among the participators.

4 Any rights that P or any other person has as a loan creditor are to be disregarded for the purposes of the assumption in subsection (3)(c).

5 If two or more persons together satisfy any of the conditions in subsections (2) and (3) and do so because they acted together to put themselves in a position where they will in fact satisfy the condition, each of them is treated as having control of C.

6 In this section— “ loan creditor ” has the meaning given by section 453, and “ participator ” has the meaning given by section 454.

7 See also section 708 (rights to be attributed for the purposes of this section).