Section 226 Joint venture group

United Kingdom

(1)

For the purposes of this Part “joint venture group” means a joint venture parent of a qualifying multinational group and its joint venture subsidiaries (together its “members”).

(2)

An entity is a joint venture parent of a multinational group F1for an accounting period of that entity if—

(a)

the financial results of that entity F2for all or any part of that period are reported under the equity method in the consolidated financial statements of the ultimate parent of that group,

(b)

the ultimate parent holds at least 50% of the ownership interests in the entity F3at any time in that period,

(c)

the entity is not the ultimate parent of a F4multinational group that meets condition A in section 129(2) for that accounting period (revenue threshold exceeded in at least 2 of previous 4 accounting periods),

(d)

the entity is not an excluded entity,

(e)

the entity is not an entity owned by an excluded entity—

(i)

that only carries out activities that are ancillary to the activities of the excluded entity,

(ii)

whose activities consist, wholly or almost wholly, of the holding of assets or the investment of funds for the benefit of the excluded entity, or

(iii)

whose income is, wholly or almost wholly, excluded dividends or excluded equity gains (or a mixture of both),

(f)

the multinational group F5referred to in paragraph (a) is not composed exclusively of excluded entities, and

(g)

the entity is not a joint venture subsidiary in relation to another joint venture parent.

(3)

An entity is a joint venture subsidiary of a joint venture parent if its assets liabilities, income, expenses and cash flows are included in the consolidated financial statements of the joint venture parent.

(4)

Where the main entity of a permanent establishment is a joint venture parent of a multinational group or a joint venture subsidiary, that permanent establishment is to be treated as a separate joint venture subsidiary of the same multinational group joint venture group.

Annotations

Textual amendments

F1: Words in s. 226(2) inserted (in relation to accounting periods commencing on or after 31.12.2024) by Finance Act 2025 (c. 8), Sch. 4 paras. 39(a), 72(3)(b)
F2: Words in s. 226(2)(a) inserted (in relation to accounting periods commencing on or after 31.12.2024) by Finance Act 2025 (c. 8), Sch. 4 paras. 39(b), 72(3)(b)
F3: Words in s. 226(2)(b) inserted (in relation to accounting periods commencing on or after 31.12.2024) by Finance Act 2025 (c. 8), Sch. 4 paras. 39(c), 72(3)(b)
F4: Words in s. 226(2)(c) substituted (in relation to accounting periods commencing on or after 31.12.2023) by Finance Act 2025 (c. 8), Sch. 4 paras. 39(d), 72(1)(b)
F5: Words in s. 226(2)(f) substituted (with effect in accordance with Sch. 4 para. 72(4) of the amending Act) by Finance Act 2025 (c. 8), Sch. 4 paras. 39(e), 72(4)

Notes on Part 3

Modifications

C1: Pt. 3 modified (2.12.2025) by Finance Act 2026 (c. 11), Sch. 8 paras. 32, 53(3)