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HMRC internal manual

Enquiry Manual

Opening the Enquiry: Statute: CTSA Time Limits - Identify the whole group before considering whether it is small

Before you consider whether a company is a member of a group that is not small, for the purpose of the time limits for opening enquiries, see EM1510, it is important to identify the whole group. This ‘whole group’ view is necessary even if the ultimate parent company or an intermediate parent company is overseas.

This is because the Companies Act defines a group as ‘a parent undertaking and its subsidiary undertakings’ and says that a ‘company is a subsidiary of another company…if it is a subsidiary of a company that is itself a subsidiary of that other company.’

The effect of those definitions is that an individual company that is a member of the complex group structure could be a member of a number of ‘groups’ within it. If the ultimate parent’s group is not small it does not matter whether the company is a member of a ‘small’ sub-group within that complex group structure. The company is still a member of a group that is not small.


Company A owns two other companies, B and C. Company B owns companies D and E while company C owns companies F and G.

There is a sub-group made up of companies B, D and E. There is another sub-group made up of companies C, F and G.

However, the group to identify, before considering whether it is small, is the widest possible group. In this case, therefore, all of the companies A - G are in the group to be considered and not just, for instance, B, D and E.

Once you have identified the whole group, you can consider the conditions to be satisfied for it to be a small group, see EM1513.