Section 257MT — Income Tax Act 2007: Excluded activity: providing services or facilities for another business

Excluded activity: providing services or facilities for another business 257MT 1 This section explains what is meant by a controlling interest in a business for the purposes of section 257MQ(1)(h).

2 In the case of a business carried on by a company, a person (“A”) has a controlling interest in the business if—

a A controls the company, b the company is a close company and A, or an associate of A, is a director of the company and either—

i is the beneficial owner of more than 30% of the ordinary share capital of the company, or ii is able, directly or through the medium of other companies or by any other indirect means, to control more than 30% of that share capital, or c at least half of the business could, in accordance with section 942 of CTA 2010, be regarded as belonging to A for the purposes of section 941 of CTA 2010 (company reconstructions without a change of ownership).

3 In any other case, a person has a controlling interest in a business if the person is entitled to at least half of the assets used for, or of the income arising from, the business.

4 For the purposes of this section—

a any rights or powers of a person who is an associate of another are to be attributed to that other person, and b “ business ” includes any trade, profession or vocation.