INTM620770 | Offshore Receipts in respect of Intangible Property (ORIP): Glossary of terms: Meaning of related persons

ITTOIA05/Ch2A/S608T

Two persons are related at any time if:

At the time:

• They are part of the same control group (See example 5),

• One of them has a 25% investment in the other (See example 6), or

• A third person has a 25% investment in both of them,

OR

At any time in a 6 month period before or after the time:

• One directly or indirectly participates in the management, control or capital of the other (See example 7), or

• A third person directly or indirectly participates in the management, control or capital of both of them.

Example 5

By virtue of s608S, Company A and Company B are part of the same control group throughout the accounting period ending 31 December 2020. Company A and Company B are therefore related for the entirety of that accounting period.

Example 6

Throughout the accounting period ending 31 December 2020, Company C held 25% of the share capital in Company D, giving equal entitlement to voting rights. Company C and Company D are therefore related for the entirety of that accounting period.

Example 7

Company E directly controls Company F. These companies are related throughout the period of control, for a 6 month period before that control began and for a 6 month period after that control ended.