Section 312D Section 312B: the trading requirementF1

(1)

For the purposes of section 312B, a company meets the trading requirement if—

(a)

it is a trading company which is not a member of a group, or

(b)

it is a member of a trading group.

(2)

“Trading company” means a company carrying on trading activities whose activities do not include to a substantial extent activities other than trading activities.

(3)

“Trading group” means a group—

(a)

one or more of whose members carry on trading group activities, and

(b)

the activities of whose members, taken together, do not include to a substantial extent activities other than trading group activities.

(4)

In this section—

“trading activities” means activities carried on by the company in the course of, or for the purposes of, a trade being carried on by it;
“trading group activities” means activities carried on by a member of the group in the course of, or for the purposes of, a trade being carried on by any member of the group.

(5)

For the purposes of determining whether a company is a trading company or a member of a trading group—

(a)

the activities of the members of a group are to be treated as one business (with the result that activities are disregarded to the extent that they are intra-group activities), and

(b)

a business carried on by a company in partnership with one or more other persons is to be treated as not being a trading activity.

Annotations

Textual amendments

F1: Pt. 4 Ch. 10A inserted (with effect in accordance with Sch. 37 para. 8 of the amending Act) by Finance Act 2014 (c. 26), Sch. 37 para. 5

Notes on Part 4

Modifications

C1: Pt. 4 modified (10.6.2021) by Finance Act 2021 (c. 26), s. 26(3)