180. Meaning Of “Substantial”
Past version: effective from 29/04/2020 - 28/04/2020
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(1) This section explains what is meant in section 179 (substantial property transactions) by a “substantial non-cash asset”.
(2) An asset is a substantial asset in relation to a company if its value–
(a) exceeds 10% of the company’s asset value and is more than 5,000 US dollars, or
(b) exceeds 100,000 US dollars.
(3) For this purpose a company’s “asset value” at any time is–
(a) the value of the company’s net assets determined by reference to its most recent statutory accounts, or
(b) if no statutory accounts have been prepared or are required to be prepared, the amount of the company’s called-up share capital.
(4) A company’s “statutory accounts” means its annual accounts prepared in accordance with Part 14, and its “most recent” statutory accounts means those in relation to which the time for sending them out to members (see section 406 (time allowed for sending out copies of accounts and reports)) is most recent.
(5) Whether an asset is a substantial asset shall be determined as at the time the arrangement is entered into.