Q. Currently Mr A owns 100% of Hold Co, which owns 100% of Trade Co. As part of a management buyout Mr B & Mr C are forming their own Company C Ltd which will buy 51% of Trade Co from Hold Co.

After this transaction, Mr A will own 100% of Hold Co that now owns 49% of Trade Co, will this jeopardise a future claim for business asset disposal relief (BADR) on the basis that Hold Co owning 49% is not a trading group? Will this be treated as a holding company of a trading group or a joint venture company?