{
  "url": "https://openlegislation.uk/corporation-tax-act-2010/section-724A",
  "json_url": "https://openlegislation.uk/corporation-tax-act-2010/section-724A.json",
  "legislation": "ukpga/2010/4",
  "legislation_title": "Corporation Tax Act 2010",
  "legislation_url": "https://openlegislation.uk/corporation-tax-act-2010",
  "path": "section/724A",
  "kind": "section",
  "number": "724A",
  "heading": "Disregard of change in parent company",
  "text": "(1) Where a new company (“N”) acquires all the issued share capital of another company (“C”), the resulting ownership change is disregarded for the purposes of Chapters 2 to 6 if, immediately after that acquisition (“the acquisition”), N—\n(a) possesses all of the voting power in C,\n(b) is beneficially entitled to 100% of any profits available for distribution to equity holders of C,\n(c) would be beneficially entitled to 100% of any assets of C available for distribution to its equity holders in the event of a winding up of C or in any other circumstances, and\n(d) meets the continuity requirements.\n(2) “The resulting ownership change” means the change in the ownership of C by reason of Condition A in section 719 being met in relation to the acquisition.\n(3) A company is “new” if, before the acquisition, it has neither—\n(a) issued any shares other than subscriber shares, nor\n(b) begun to carry on any trade or business.\n(4) N meets the continuity requirements if, and only if—\n(a) the consideration for the acquisition consists only of the issue of shares in N to the shareholders of C,\n(b) immediately after the acquisition, each person who immediately before the acquisition was a shareholder of C is a shareholder of N,\n(c) immediately after the acquisition, the shares in N are of the same classes as were the shares in C immediately before the acquisition,\n(d) immediately after the acquisition, the number of shares of any particular class in N bears to all the shares in N the same proportion, or as nearly as may be the same proportion, as the number of shares of that class in C bore to all the shares in C immediately before the acquisition, and\n(e) immediately after the acquisition, the proportion of shares of any particular class in N held by any particular shareholder is the same, or as nearly as may be the same, as the proportion of shares of that class in C held by that shareholder immediately before the acquisition.\n(5) For the purposes of this section, N is treated as acquiring all the issued share capital of C for consideration consisting only of the issue of shares in N to the shareholders of C if, as a result of a scheme of reconstruction involving the cancellation of all shares in C and the issue of shares in N—\n(a) N holds all the issued share capital of C by reason of that share capital being issued to N by C, and\n(b) only shares in N are issued to the persons who were shareholders of C immediately before the shares in C were cancelled.\n(6) In a case within subsection (5), subsection (4) applies as if any reference to immediately before the acquisition were a reference to immediately before the shares in C were cancelled.\n(7) “Scheme of reconstruction” means a scheme carried out in pursuance of a compromise or arrangement—\n(a) to which Part 26 or 26A of the Companies Act 2006 (arrangements and reconstructions) applies, or\n(b) under any corresponding provision of the law of a country or territory outside the United Kingdom.\n(8) Chapter 6 of Part 5 (equity holders and profits or assets available for distribution) applies for the purposes of subsection (1)(b) and (c) as it applies for the purposes of section 151(4).",
  "extent": "E+W+S+N.I.",
  "status": null,
  "version": "current",
  "annotations": [
    {
      "type": "F",
      "label": "F1",
      "text": "S. 724A inserted (with effect in accordance with s. 37(6) of the amending Act) by Finance Act 2014 (c. 26), s. 37(4)"
    },
    {
      "type": "F",
      "label": "F2",
      "text": "Words in s. 724A(7)(a) inserted (26.6.2020) by Corporate Insolvency and Governance Act 2020 (c. 12), s. 49(1), Sch. 9 para. 44 (with ss. 2(2), 5(2))"
    },
    {
      "type": "C",
      "label": "C1",
      "text": "Ss. 719-724A modified (with effect in relation to accounting periods commencing on or after 31.12.2023) by Finance (No. 2) Act 2023 (c. 30), ss. 212(5), 264"
    }
  ],
  "outstanding_effects": [],
  "provenance": {
    "source": "legislation.gov.uk",
    "source_url": "https://www.legislation.gov.uk/ukpga/2010/4/section/724A",
    "retrieved_at": "2026-10-29T09:10:29.433154+00:00"
  },
  "licence": "Open Government Licence v3.0",
  "licence_url": "https://www.nationalarchives.gov.uk/doc/open-government-licence/version/3/",
  "attribution": "Contains public sector information licensed under the Open Government Licence v3.0. Source: legislation.gov.uk, The National Archives."
}