Section 280D — Income Tax Act 2007: The no business acquisition condition

The no business acquisition condition 280D 1 This section applies for the purposes of the no business acquisition condition.

2 Where a company makes an investment in another company (“ the relevant company ”), that investment breaches the prohibition on business acquisitions if any of the money raised by it is employed (whether on its own or together with other money) on the acquisition, directly or indirectly, of—

a an interest in another company such that a company becomes a 51% subsidiary of the relevant company, b a further interest in a company which is a 51% subsidiary of the relevant company, c a trade, d intangible assets employed for the purposes of a trade, or e goodwill employed for the purposes of a trade.

3 The Treasury may by regulations provide that subsection (2) does not apply in relation to acquisitions of intangible assets which are of a description specified, or which occur in circumstances specified, in the regulations.

4 In this section— “ goodwill ” has the same meaning as in Part 8 of CTA 2009 (see section 715(3)); “ intangible assets ” means any asset which falls to be treated as an intangible asset in accordance with generally accepted accountancy practice; and section 280B(8) and (9) apply for the purposes of this section as they apply for the purposes of section 280B.