CTM80140 | Groups: group relief: meaning of excess management expenses
From HM Revenue & Customs · Company Taxation Manual
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Excess management expenses can be surrendered and claimed as group relief ().
This does not apply where the surrendering company carries on the business of life assurance ().
Management expenses means expenses that are deductible for the surrender period under (see ).
Management expenses are a ‘relevant amount’ for the group relief provisions, so can only be surrendered to the extent that the total of the surrendering company’s relevant amounts exceeds the ‘profit-related threshold’ (or ‘gross profit’ in surrendering periods ended before 20 March 2013; see , ). This is the case regardless of whether the surrendering company uses any of the relevant amounts against its own profits.
The calculation will need to take into account the prescribed order of surrender of relevant amounts (see ).
Excess management expenses does not include:
management expenses brought forward from another accounting period under , or
brought forward losses of a company with investment business, that ceases to carry on UK property business, that are treated as management expenses of the current period under .
See the example at on surrender of excess management expenses.