Not associated

The respondents a married couple were directors of Paycheck Services Ltd. They each held 50% of the issued share capital.

In turn Paycheck Services Ltd owned two subsidiaries P(DS) Ltd and P(SS) Ltd.

The subsidiaries were incorporated to act as director and secretary of a further 42 companies which were together known as the composite companies.

The share capital in these companies comprised one ‘A’ share and 50 non-voting shares each of a separate class. The A share was held by PST Ltd. The respondents were directors and owners of this company.

Although the companies would have seemed to be associated under TA 1988 s 13 on the ground that they were controlled by PST Ltd and their collective turnover was more than £300 000 the respondents relied on Extra-statutory Concession C9 ‘Associated companies’ for...