Commentary on Provisions Part 1 – Scottish Aggregates Tax Special cases Section 29: Groups of companies
91.This section provides for how groups of companies and members of groups are to be treated with regard to tax liabilities. This includes providing how groups of companies are liable through their representative member carrying out taxable activities (see section 18) and how corporate bodies can be considered a group.
92.Subsections (2) to (3) set out the conditions of the application for group treatment. An application for group treatment is made to Revenue Scotland under subsection (4) setting out which of the bodies corporate is to be the representative member. As per subsection (6) a successful application will take effect from the beginning of a particular accounting period. An application to vary or end the group treatment may be made under subsection (7) and, as per subsection (8), may be granted with effect from a time specified by Revenue Scotland in a written notice to the members of the group.
93.Subsection (9) provides that Revenue Scotland only has discretion to refuse an application under subsection (4) or subsection (7) if it appears necessary to do so for the protection of the revenue (i.e. to prevent the loss of tax revenue) – otherwise the application must be granted. However Revenue Scotland has no discretion at all to refuse an application under subsection (7)(b) to exclude a body corporate from group treatments.
94.Subsection (10) states that an application under this section must be made by the bodies or person controlling them and that the application should be made 90 days before the group status is to take effect.
95.Subsection (11) sets out the circumstances in which a corporate body or individuals will be deemed to control another corporate body, mainly if the corporate body is the latter body’s holding company within the meaning of section 1159 and Schedule 6 of the Companies Act 2006 or, in the case of individuals, would be were the individuals a company.