Section 436 | Meaning of “qualifying infrastructure activity” F1
From legislation.gov.uk
(1)For the purposes of this Chapter a company carries on a “qualifying infrastructure activity” if the company—
(a)provides an asset that is a public infrastructure asset in relation to it (see subsections (2) and (5)), or
(b)carries on any other activity that is ancillary to, or facilitates, the provision of an asset that is a public infrastructure asset in relation to it.
(2)For the purposes of this Chapter an asset is a “public infrastructure asset” in relation to a company at any time if—
(a)the asset is, or is to be, a tangible asset forming part of the infrastructure of the United Kingdom or the UK sector of the continental shelf,
(b)the asset meets the public benefit test (see subsections (3) and (4)),
(c)the asset has had, has or is likely to have an expected economic life of at least 10 years, and
(d)the asset meets the group balance sheet test (see subsections (10) and (10A)) in relation to the company.F2
(3)An asset meets the “public benefit test” if—
(a)the asset is, or is to be, procured by a relevant public body, or
(b)the asset is, or is to be, used in the course of a regulated activity.
(4)An asset is used in the course of a “regulated activity” if its use—
(a)is regulated by an infrastructure authority (see section 437(2)), or
(b)could be regulated by an infrastructure authority if the authority exercised any of its powers.
(5)For the purposes of this Chapter a building, or part of a building, is also a “public infrastructure asset” in relation to a company at any time if—
(a)the building or part is, or is to be, let on a short-term basis —F3
(i)within a UK property business carried on by the company, or another member of the worldwide group of which it is a member at that time, andF3
(ii)to persons who, at that time, are not related parties of the company or member.F3
(c)the building or part has had, has or is likely to have an expected economic life of at least 10 years, and
(d)the building or part meets the group balance sheet test in relation to the company.
(5A)But a building, or part of a building, is not a public infrastructure asset in relation to a company at a particular time if, were the building or part to be disposed of at that time, profits arising from the disposal would be charged to corporation tax as profits of a trade.F4
(6)A building, or part of a building, is “let” to a person if the person is entitled to the use of the building or part under a lease or other arrangement.
(7)A building, or part of a building, is let on a “short-term basis” if the lease or other arrangement in question—
(a)has an effective duration which is 50 years or less, and
(b)is not an arrangement to which any provision of Chapter 2 of Part 16 of CTA 2010 applies (finance arrangements).
(8)Whether or not a lease or other arrangement has an effective duration which is 50 years or less is determined in accordance with Chapter 4 of Part 4 of CTA 2009 (reading any reference to a lease as a reference to a lease or other arrangement within subsection (6)).
(9)For the purposes of this section references to a building or part of a building being let include the building or part being sub-let, and, accordingly, references to a lease include a sub-lease.
(10)An asset meets the “group balance sheet test” in relation to a company at any time if—
(a)an entry in respect of the asset is, or would be, recognised (whether as a tangible asset or otherwise) in a balance sheet of the company, or an associated company, that is drawn up at that time, and
(b)the company or associated company is within the charge to corporation tax at that time in respect of all of its sources of income and no election or claim mentioned in section 433(11)(b) or (c) has effect for a period including that time.
(10A)In determining whether the condition in subsection (10)(b) is met in relation to a company not resident in the United Kingdom at any time, a source of income of the company is ignored if, having regard to all the circumstances, it is reasonable to regard as insignificant the amount of income arising from the source for the accounting period including that time.F5
(11)For the purposes of this Chapter references to provision, in relation to a public infrastructure asset, include its acquisition, design, construction, conversion, improvement, operation or repair.