CTM06825 | Corporation Tax: loss buying: restriction of group relief for carried-forward losses: consortia
From HM Revenue & Customs · Company Taxation Manual
to S676CD
S676CC to S676CD are concerned with situations where there has been a change in company ownership and, immediately before that change, the transferred company was owned by a consortium.
Prior to the change in ownership, the transferred company, company C, and another company, company X, may have met one of the consortium conditions. As a result, they may have been able to surrender losses to or claim losses from another company for group relief for carried-forward losses ().
In some circumstances, the change in ownership may effectively sever the relationship between the company and the consortium for the purposes of . Once its ownership has changed, company C may no longer be in a position to surrender losses to, or claim losses from, company X or any other company in relation to which it previously met one of the consortium conditions. In these circumstances, to S676CD have no application.
But this will not always be the case. For example, company C and company X may meet a consortium condition before the change and a group claim condition ( and S188FB, ) after the change in ownership.
If
immediately before the change in ownership, company C and company X meet one of the consortium conditions, and
following the change in ownership, company C and company X are still in a position where one company might potentially surrender to or claim losses from the other company under
to S676CD control the reliefs available.
In these circumstances
governs the amount of relief the transferred company is able to claim, and
governs the amount of relief the transferred company is able to surrender.
Only the reliefs restricted more generally by are affected.
Broadly, these are reliefs for losses incurred before the change in ownership and carried forward under one of a number of provisions ().
Losses incurred after the change in ownership are not restricted by either or S676CD.