188ÌåÓý

Window of opportunity when qualifying after 28 July 2000

Newly qualifying companies or groups may make an election under FA00/SCH22/PARA10 (2) and (3), but any such election must be made within 12 months of the date on which they become qualifying.ÌýÌý(See TTM03001Ìýfor the meaning of ‘qualifyingâ€� company or group.)

This window of opportunity is only available from the date on which the company or group first becomes a qualifying company or group. In particular:
Ìý

• A newly qualifying company may not make an election under this provision if it has previously been a qualifying company since 28 July 2000.
  Ìý
• A group may not make an election under this provision if it is substantially the same as a group that was previously a qualifying group at any time since 28 July 2000.

These rules are framed so as to prevent a company or group avoiding the normal time restrictions for making an election into tonnage tax.Ìý For example:

• A company that chose not to enter tonnage tax during the initial period might arrange to become non-qualifying by divesting itself of its shipping interests, and then become qualifying again by buying them back.

Such a company would previously have been a qualifying company, and would therefore be ineligible to make an election under the provisions applying to newly qualifying companies.

• A group that chose not to enter tonnage tax during the initial period might arrange for its shipping activities to be transferred to a newly formed subsidiary.

Such a group would be ‘substantially the same� as a previously qualifying group, and would therefore be ineligible to make an election under these provisions.

Although it may not benefit from the provisions relating to newly qualifying companies or groups, a previously qualifying company or group may become eligible to make an election under the special provisions relating to mergersÌý(see TTM02170).

HMRC has a measure of flexibility to consent to electionsÌýmade after the end of the 12 months period mentioned above where thereÌýwas a reasonable excuse for the failure to meet the requirement and consent was requested without delay, or there was a reasonable excuse for any further delay.Ìý See FA22/S25 (2).Ìý The aim is to admit elections delayed for unforeseen administrative reasons.Ìý Consent should be sought from the Tonnage Tax Technical Adviser, see TTM01120.

References

FA00/SCH22/PARA10 (newly qualifying companies and groups)	TTM17046
Foreign companies or groups new to the UK	TTM02265
Special rules for certain mergers	TTM02170