Income and Corporation Taxes Act 1988

407 Relationship between group relief and other relief. U.K.

(1) M1 Group relief for an accounting period shall be allowed as a deduction against the claimant company’s total profits for the period—

(a) before reduction by any relief derived from a subsequent accounting period, but

(b) M2 as reduced by any other relief from tax (including relief in respect of charges on income under section 338(1) [F1 of this Act or by virtue of section 83 of, or paragraph 4 of Schedule 11 to, the Finance Act 1996 (non-trading deficits)]) determined on the assumption that the company makes all relevant claims under section [F2 393A(1)] of this Act and [F3 section 260(3) of the Capital Allowances Act](set-off of capital allowances against total profits).

(2) For the purposes of this section “relief derived from a subsequent accounting period” means—

(a) M3 relief under section [F4 393A(1)(b)] in respect of a loss incurred in an accounting period after the accounting period the profits of which are being computed; and

(b) M4 relief under [F5 section 260(3) of the Capital Allowances Act] in respect of capital allowances falling to be made for an accounting period after the accounting period the profits of which are being computed; [F6 and]

[F7 [F8 (c) relief in pursuance of a claim under section 83(2) of, or paragraph 4 of Schedule 11 to, the Finance Act 1996 (non-trading deficits) in respect of any deficit for a deficit period after the accounting period the profits of which are being computed.]]

(3) M5 The reductions to be made in total profits of an accounting period against which any relief derived from a subsequent accounting period is to be set off shall include any group relief for that first-mentioned accounting period.

Textual Amendments

F1 Words in s. 407(1)(b) inserted (with effect in accordance with s. 105(1) of the amending Act) by Finance Act 1996 (c. 8), Sch. 14 para. 22(1) (with Sch. 15)

F2 Words in s. 407(1)(b) substituted by Finance Act 1991 (c. 31, SIF 63:1), s. 73(3)-(5), Sch. 15 para. 14(1)

F3 Words in s. 407(1)(b) substituted (with effect in accordance with s. 579(1) of the amending Act) by Capital Allowances Act 2001 (c. 2), Sch. 2 para. 37(1) (with Sch. 3)

F4 Words in s. 407(2)(a) substituted by Finance Act 1991 (c. 31, SIF 63:1), s. 73(3)-(5), Sch. 15 para. 14(2)

F5 Words in s. 407(2)(b) substituted (with effect in accordance with s. 579(1) of the amending Act) by Capital Allowances Act 2001 (c. 2), Sch. 2 para. 37(2) (with Sch. 3)

F6 Word in s. 407(2) inserted (27.7.1993 ) by 1993 c. 34, s. 170, Sch. 18 para.4

F7 S. 407(2)(c) and words inserted (27.7.1993) by 1993 c. 34, s. 170, Sch. 18 para.4

F8 S. 407(2)(c) substituted for para. (c) and words following it (with effect in accordance with s. 105(1) of the amending Act) by Finance Act 1996 (c. 8), Sch. 14 para. 22(2) (with Sch. 15)

Marginal Citations

M1 Source—1970 s.260(1)

M2 Source—1970 s.260(1), (2)

M3 Source—1970 s.260(3)(a), (d)

M4 Source—1970 s.260(3)(b)

M5 Source—1970 s.260(4)