{
  "url": "https://openlegislation.uk/income-tax-act-2007/section-257HG",
  "json_url": "https://openlegislation.uk/income-tax-act-2007/section-257HG.json",
  "legislation": "ukpga/2007/3",
  "legislation_title": "Income Tax Act 2007",
  "legislation_url": "https://openlegislation.uk/income-tax-act-2007",
  "path": "section/257HG",
  "kind": "section",
  "number": "257HG",
  "heading": "Meaning of “qualifying business activity”",
  "text": "(1) In this Part “qualifying business activity”, in relation to the issuing company, means—\n(a) activity A, or\n(b) activity B,\nif it is carried on by the company or a qualifying 90% subsidiary of the company.\nThis is subject to subsection (3).\n(2) Activity A is—\n(a) the carrying on of a new qualifying trade which, on the date the relevant shares are issued, the company or a qualifying 90% subsidiary of the company is carrying on, or\n(b) the activity of preparing to carry on (or preparing to carry on and then carrying on) a new qualifying trade—\n(i) which, on that date, is intended to be carried on by the company or such a subsidiary, and\n(ii) which is begun to be carried on by the company or such a subsidiary.\n(3) Activity B is the carrying on of research and development—\n(a) which, on the date the relevant shares are issued, the company or a qualifying 90% subsidiary of the company is carrying on, or which the company or such a subsidiary begins to carry on immediately afterwards, and\n(b) from which, on that date, it is intended—\n(i) that a new qualifying trade which the company or such a subsidiary will carry on will be derived, or\n(ii) that a new qualifying trade which the company or such a subsidiary is carrying on, or will carry on, will benefit.\n(4) For the purposes of subsection (3)(a), when research and development is begun to be carried on by a qualifying 90% subsidiary of the issuing company, any carrying on of the research and development by it before it became such a subsidiary is ignored.\n(5) References in subsection (2)(b)(i) or (3)(b) to a qualifying 90% subsidiary of the issuing company include references to any existing or future company which will be such a subsidiary at any future time.",
  "extent": null,
  "status": null,
  "version": "current",
  "annotations": [
    {
      "type": "F",
      "label": "F1",
      "text": "Pt. 5A inserted (17.7.2012) (with effect in accordance with Sch. 6 para. 24(1) of the amending Act) by Finance Act 2012 (c. 14), Sch. 6 para. 1"
    }
  ],
  "outstanding_effects": [],
  "provenance": {
    "source": "legislation.gov.uk",
    "source_url": "https://www.legislation.gov.uk/ukpga/2007/3/section/257HG",
    "retrieved_at": "2026-10-29T09:13:03.599581+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."
}