CTM82010 | Corporation Tax: Group relief for carried-forward losses: General
From HM Revenue & Customs · Company Taxation Manual
From 1 April 2017, companies can surrender certain types of carried-forward losses to another company in the same group relief group (see ).
is modelled on and extends the group relief rules, so that companies can claim group relief for losses that have been carried forward from a previous accounting period. This only applies to losses that are incurred on or after 1 April 2017.
Previously, companies could only claim group relief for losses incurred by another group member in a corresponding accounting period. This rule still applies for losses incurred before 1 April 2017.
There are on the types of losses that can be surrendered as group relief for carried-forward losses. There are also some restrictions on the amount of carried-forward losses that a company can surrender, , and restrictions on the amount of profit a company has available for relief, the .
General restriction on use of all carried-forward losses
The total amount of relief a company can obtain using carried-forward losses is limited by the . This applies to group relief for carried-forward losses as well as to the company’s own losses carried forward. A company cannot use group relief for carried-forward losses to obtain any additional relief beyond the amount permitted by the restriction. ().
A company may also only claim or surrender group relief for carried-forward losses once it has used its own losses as far as possible.
Restriction for group relief for carried forward losses following a change in ownership of a company
/Chapters 2C and 2D additionally restrict the relief for pre-acquisition losses surrendered as group relief for carried-forward losses by a company whose ownership has changed. )
Administrative requirements
The administrative requirements for group relief, such as and returns, are set out in . These requirements apply to group relief for carried-forward losses. It also introduces additional requirements for notice of consent for claims to group relief for carried-forward losses.
Joint Amended Returns
Regulation 10 of Statutory Instrument 1999/2975, as amended by SI2018/9, provides that an authorised company can . This works in the same way as a joint amended return does for group relief for losses of the same year. However, the regulations require companies to make a further application in order to use the simplified procedures for group relief for carried-forward losses.