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Change 1
As published
288 Lead member of a group and its qualifying periods
(1) For the purposes of section 280(2) (meaning of qualifying period), the reference to an accounting period of a generating undertaking that is a group means an accounting period of its lead member.
(2) Take the following steps in order to identify the lead member of the group (stopping at the first step under which a member of the group is identified as the lead member)—
Step 1
If there is a member of the group that—
is within the charge to corporation tax, and
is nominated for the purposes of this section,
that member is the lead member of the group.
Step 2
If the principal member of the group is within the charge to corporation tax, it is the lead member of the group.
Step 3
If—
there is a member of the group that—
is within the charge to corporation tax, and
has no 75% parent within the charge to corporation tax, and
there is no other member of the group falling within paragraph (a),
that member is the lead member of the group.
Step 4
If there is more than one member falling within paragraph (a) of Step 3, the lead member is the member falling within that paragraph to which the greatest amount of generation would be attributed under section 282(1) in the period of 12 months ending with the later of 31 December 2022 and the beginning of the first qualifying period in which the group is a qualifying generating undertaking if—
each such member were a generating undertaking, and
that period of 12 months were a qualifying period.
Step 5
If none of the preceding steps identifies a lead member, the principal member of the group (who will not be within the charge to corporation tax) is the lead member of the group.
(3) For the purposes of subsection (2), a company (“P”) is a 75% parent of another company if that other company is a 75% subsidiary—
(a) of P,
(b) of a 75% subsidiary of P, or
(c) of a 75% subsidiary of a 75% subsidiary of P, and so on.
(4) A nomination of a member of a group as the lead member of the group—
(a) is to be made by the member of the group that, ignoring Step 1 in subsection (2), would be the lead member of the group (“the nominating member”),
(b) must be made by notice to HMRC,
(c) must specify when it takes effect, which must be no earlier than the commencement of the qualifying period in which it is made, and
(d) has effect until—
(i) a further nomination takes effect,
(ii) it is revoked, or
(iii) the nominated member leaves the group.
(5) The revocation of a nomination of a member of a group as the lead member—
(a) is to be made by the member of the group that, ignoring Step 1 in subsection (2), would be the lead member of the group,
(b) must be made by notice to HMRC, and
(c) must specify when it takes effect, which must be no earlier than the commencement of the qualifying period in which it is made.
(6) Where a company becomes lead member of a group during a qualifying period, and that period is not the same as an accounting period of the new lead member—
(a) the qualifying period ends, and
(b) a qualifying period commences that ends with the end of the current accounting period of the new lead member.
Your change, as a redline
288 Lead member of a group and its qualifying periods
(1) For the purposes of section 280(2) (meaning of qualifying period), the reference to an accounting period of a generating undertaking that is a group means an accounting period of its lead member.
(2) Take the following steps in order to identify the lead member of the group (stopping at the first step under which a member of the group is identified as the lead member)—
Step 1
If there is a member of the group that—
is within the charge to corporation tax, and
is nominated for the purposes of this section,
that member is the lead member of the group.
Step 2
If the principal member of the group is within the charge to corporation tax, it is the lead member of the group.
Step 3
If—
there is a member of the group that—
is within the charge to corporation tax, and
has no 75% parent within the charge to corporation tax, and
there is no other member of the group falling within paragraph (a),
that member is the lead member of the group.
Step 4
If there is more than one member falling within paragraph (a) of Step 3, the lead member is the member falling within that paragraph to which the greatest amount of generation would be attributed under section 282(1) in the period of 12 months ending with the later of 31 December 2022 and the beginning of the first qualifying period in which the group is a qualifying generating undertaking if—
each such member were a generating undertaking, and
that period of 12 months were a qualifying period.
Step 5
If none of the preceding steps identifies a lead member, the principal member of the group (who will not be within the charge to corporation tax) is the lead member of the group.
(3) For the purposes of subsection (2), a company (“P”) is a 75% parent of another company if that other company is a 75% subsidiary—
(a) of P,
(b) of a 75% subsidiary of P, or
(c) of a 75% subsidiary of a 75% subsidiary of P, and so on.
(4) A nomination of a member of a group as the lead member of the group—
(a) is to be made by the member of the group that, ignoring Step 1 in subsection (2), would be the lead member of the group (“the nominating member”),
(b) must be made by notice to HMRC,
(c) must specify when it takes effect, which must be no earlier than the commencement of the qualifying period in which it is made, and
(d) has effect until—
(i) a further nomination takes effect,
(ii) it is revoked, or
(iii) the nominated member leaves the group.
(5) The revocation of a nomination of a member of a group as the lead member—
(a) is to be made by the member of the group that, ignoring Step 1 in subsection (2), would be the lead member of the group,
(b) must be made by notice to HMRC, and
(c) must specify when it takes effect, which must be no earlier than the commencement of the qualifying period in which it is made.
(6) Where a company becomes lead member of a group during a qualifying period, and that period is not the same as an accounting period of the new lead member—
(a) the qualifying period ends, and
(b) a qualifying period commences that ends with the end of the current accounting period of the new lead member.
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