Chapter CTM82520
| Published date | 16 April 2016 |
| Record Number | CTM82520 |
Where the claimant company is a company owned by the consortium, the amount of relief that can be given for group relief for carried-forward losses is limited to the lower of:
- the unused parts of the surrenderable amounts for the overlapping period, and
- the claimant company’s relevant maximum for the overlapping period less any amount of group/consortium relief previously claimed for the same period (CTA10/S188DE).
Claims must be given effect to in a certain order with other deductions of the same period. This order of relief is the same as for group relief for carried-forward losses within groups (CTA10/S188CK(6) to (8)) (CTM82100).
Ownership proportion Claims under condition 1 (claimant company is owned by a consortium and surrendering company is a consortium member) CTA10/S188DHWhere the claim is under condition 1, the amount of relief that can be claimed is also limited to the consortium member’s ownership proportion of the claimant’s relevant maximum profits during the overlapping period.
Ownership proportion is the lower of:
- the proportion of the ordinary share capital beneficially owned by the surrendering company,
- the proportion of the surrendering company’s beneficial entitlement of profit distribution to equity holders,
- the proportion of the surrendering company’s beneficial entitlement to any assets on winding up, and
- the proportion of the voting power directly owned by the surrendering company.
If any of the above proportions changes during the overlapping period, use the average proportion during that period (S188DH(4)).
Claims under condition 2 (claimant company owned by consortium and surrendering company is a link company) CTA10/S188DI, CTA10/S188DJFor claims relating to condition 2, the amount of relief that can be claimed is limited to the member of the consortium (link company)’s proportion of the claimant’s relevant maximum profits for the overlapping period (CTA10/S188DI).
Example 1Company A owns 40% of Company B’s ordinary share capital including all rights attached to those shares. Company B is a company owned by a consortium, and Company A is a member of that consortium.
Company C is in the same group of companies as Company A, and wants to surrender group relief for carried-forward losses to Company B. Company A is the link company. All 3 companies have the same accounting period and therefore the same overlapping period.
Company B’s relevant maximum for the overlapping period is...
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