VCM74900 - Share loss relief: individual and corporate claimants: individual claimants: type of company invested in: qualifying trading company: condition A: control and independence requirement: introduction
The control and independence requirement is one of the four requirements of condition A at ITA07/S134, and condition A is one the four conditions a company must meet in order for it to be a qualifying trading company.
The control and independence requirement is set out in detail at ITA07/S139. It has two elements: the control element and the independence element. Each element refers to 바카라 사이트˜arrangements바카라 사이트™ the existence of which will prevent the requirement being met. In this context, 바카라 사이트˜arrangements바카라 사이트™ includes any scheme, arrangement or understanding, whether or not legally enforceable. The existence of any such arrangements will be a question of fact and careful and thorough enquiry and evidence-gathering will be necessary if they are suspected.
When a company is taken over by another company in a share-for-share exchange it will very likely cease to be independent. This means the control and independence requirement may no longer be met and the second company바카라 사이트™s shares would not be capable of being qualifying shares. ITA07/S145 and S146 address this and mean that, in some circumstances, the second company바카라 사이트™s shares will be qualifying shares for Share Loss Relief purposes (see VCM75350 and VCM75360). Where this is the case nothing in section 139 applies to the share-for-share exchange. In particular, the existence of arrangements with a view to the exchange will not mean the control and independence requirement is not met by the first or second companies.