SCHEDULE 18 Company tax returns, assessments and related matters
Part VIII Claims for group relief
Introduction
66
This Part of this Schedule applies to claims for relief under F1Part 5 of the Corporation Tax Act 2010 (group relief).
Claim to be included in company tax return
67
(1)
A claim for group relief must be made by being included in the claimant company’s company tax return for the accounting period for which the claim is made.
(2)
It may be included in the return originally made or by amendment.
Content of claims
68
(1)
A claim for group relief must specify—
(a)
the amount of relief claimed, and
(b)
the name of the surrendering company.
(2)
The amount specified must be an amount which is quantified at the time the claim is made.
F2(3)
A claim for group relief must also state whether or not there is a company mentioned in sub-paragraph (4) that was not resident in the United Kingdom in either or both of the following periods—
(a)
the accounting period of the surrendering company to which the surrender relates,
(b)
the corresponding accounting period of the claimant company.
(4)
Those companies are the claimant company, the surrendering company and any other company by reference to which—
(a)
the claimant company and the surrendering company are members of the same group, or
F3(b)
consortium condition 1, 2 or 3 in sections 132 and 133 of the Corporation Tax Act 2010 is satisfied in the case of the claimant company and the surrendering company.
Claims for more or less than the amount available for surrender
69
(1)
A claim for group relief may be made for less than the amount available for surrender at the time the claim is made.
(2)
A claim is ineffective if the amount claimed exceeds the amount available for surrender at the time the claim is made.
(3)
For these purposes the amount available for surrender at any time is calculated as follows.
First step
Determine the total amount available for surrender under F4Part 5 of the Corporation Tax Act 2010—
- (a)
on the basis of the information in the company’s company tax return, and
- (b)
disregarding any amendments whose effect is deferred under paragraph 31(3).
- (a)
Second step
Then deduct the total of all amounts for which notices of consent have been given by the company and not withdrawn.
(4)
Where one or more claims are withdrawn on the same day as one or more claims are made, the withdrawals are given effect first.
(5)
Where more than one claim is made on the same day, and the claims together take the amount claimed over the limit of what is available for surrender, F5an officer of Revenue and Customs may determine which of the claims is to be ineffective.
(6)
The power under sub-paragraph (5) shall not be exercised to any greater extent than is necessary to bring the total amount claimed within the amount available for surrender.
Consent to surrender
70
(1)
F6In accordance with Requirement 1 in section 130(2) of the Corporation Tax Act 2010 or Requirement 1 in section 135(2) of that Act (as the case may be), a claim for group relief requires the consent of the surrendering company.
(2)
A consortium claim also requires the consent of each member of the consortium.
(3)
The necessary consent or consents must be given—
(a)
by notice in writing,
(b)
to the officer of the Board to whom the surrendering company makes its company tax returns,
(c)
at or before the time the claim is made.
Otherwise the claim is ineffective.
(4)
A claim for group relief is ineffective unless it is accompanied by a copy of the notice of consent to surrender given by the surrendering company.
(5)
A consortium claim is ineffective unless it is also accompanied by a copy of the notice of consent to surrender given by each member of the consortium.
F7(6)
In this paragraph “consortium claim” means a claim for group relief under Part 5 of the Corporation Tax Act 2010 based on consortium condition 1, 2 or 3 (see Requirement 3 in section 130(2) of that Act).
Notice of consent
71
(1)
Notice of consent by the surrendering company must contain all the following details—
(a)
the name of the surrendering company;
(b)
the name of the company to which relief is being surrendered;
(c)
the amount of relief being surrendered;
(d)
the accounting period of the surrendering company to which the surrender relates;
(e)
the tax district references of the surrendering company and the company to which relief is being surrendered.
Otherwise the notice is ineffective.
(2)
Notice of consent may not be amended, but it may be withdrawn and replaced by another notice of consent.
(3)
Notice of consent may be withdrawn by notice to the officer of the Board to whom the notice of consent was given.
(4)
Except where the consent is withdrawn under paragraph 75 (withdrawal in consequence of reduction of amount available for surrender), the notice of withdrawal must be accompanied by a notice signifying the consent of the claimant company to the withdrawal.
Otherwise the notice is ineffective.
(5)
The claimant company must, so far as it may do so, amend its company tax return for the accounting period for which the claim was made so as to reflect the withdrawal of consent.
Notice of consent requiring amendment of return
72
(1)
Where notice of consent by the surrendering company is given after the company has made a company tax return for the period to which the surrender relates, the surrendering company must at the same time amend its return so as to reflect the notice of consent.
(2)
Where notice of consent by the surrendering company relates to a loss in respect of which relief has been given under F8section 45 of the Corporation Tax Act 2010 (carry forward of trading losses), the surrendering company must at the same time amend its company tax return for the period or, if more than one, each of the periods in which relief for that loss has been given under F9section 45 so as to reflect the new notice of consent.
For this purpose relief under F9section 45 is treated as given for losses incurred in earlier accounting periods before losses incurred in later accounting periods.
(3)
The time limits otherwise applicable to amendment of a company tax return do not prevent an amendment being made under sub-paragraph (1) or (2).
(4)
If the surrendering company fails to comply with sub-paragraph (1) or (2), the notice of consent is ineffective.
Withdrawal or amendment of claim
73
(1)
A claim for group relief may be withdrawn by the claimant company only by amending its company tax return.
(2)
A claim for group relief may not be amended, but must be withdrawn and replaced by another claim.
Time limit for claims
74
(1)
A claim for group relief may be made or withdrawn at any time up to whichever is the last of the following dates—
(a)
the first anniversary of the filing date for the company tax return of the claimant company for the accounting period for which the claim is made;
(b)
if notice of enquiry is given into that return, 30 days after the enquiry is completed;
(c)
(d)
if an appeal is brought against such an amendment, 30 days after the date on which the appeal is finally determined.
(2)
(3)
The time limits otherwise applicable to amendment of a company tax return do not apply to an amendment to the extent that it makes or withdraws a claim for group relief within the time allowed by or under this paragraph.
(4)
The references in sub-paragraph (1) to an enquiry into a company tax return do not include an enquiry restricted to a previous amendment making or withdrawing a claim for group relief.
An enquiry is so restricted if—
(a)
the scope of the enquiry is limited as mentioned in paragraph 25(2), and
(b)
the amendment giving rise to the enquiry consisted of the making or withdrawing of a claim for group relief.
Reduction in amount available for surrender
75
(1)
This paragraph applies if, after the surrendering company has given one or more notices of consent to surrender, the F11total amount available for surrender is reduced to less than the amount stated in the notice, or the total of the amounts stated in the notices, as being surrendered.
(2)
The company must within 30 days withdraw the notice of consent, or as many of the notices as is necessary to bring the total amount surrendered within the new F12total amount available for surrender, and may give one or more new notices of consent.
(3)
The company must give notice in writing of the withdrawal of consent, and send a copy of any new notice of consent—
(a)
to each of the companies affected, and
(b)
to F5an officer of Revenue and Customs.
(4)
If the surrendering company fails to act in accordance with sub-paragraph (2), F5an officer of Revenue and Customs may by notice to the surrendering company give such directions as F10he thinks fit as to which notice or notices are to be ineffective or are to have effect in a lesser amount.
This power shall not be exercised to any greater extent than is necessary to secure that the total amount stated in the notice or notices is consistent with the F12total amount available for surrender.
(5)
(6)
A claimant company which receives—
(a)
notice of the withdrawal of consent, or a copy of a new notice of consent, under sub-paragraph (3), or
(b)
a copy of a notice containing directions by F5an officer of Revenue and Customs under sub-paragraph (4),
must, so far as it may do so, amend its company tax return for the accounting period for which the claim is made so that it is consistent with the new position with regard to consent to surrender.
(7)
An appeal may be brought by the surrendering company against any directions given by F5an officer of Revenue and Customs under sub-paragraph (4).
(8)
Notice of appeal must be given—
(a)
in writing,
(b)
within 30 days after the notice containing the directions was issued,
(c)
to the officer of the Board by whom the notice was given.
F13Assessment on other claimant companies
F1475A
(1)
This paragraph applies where, after the surrendering company has given notice of consent to surrender, a claimant company (“the chargeable company”) has become liable to tax in consequence of receiving—
(a)
notice of the withdrawal of consent, or a copy of a new notice of consent, under paragraph 75(3), or
(b)
a copy of a notice containing directions by F5an officer of Revenue and Customs under paragraph 75(4).
(2)
If any of the tax is unpaid six months after the chargeable company’s time limit for claims, F5an officer of Revenue and Customs may make an assessment to tax in the name of the chargeable company on any other company that has obtained group relief as a result of the surrender.
(3)
The assessment may not be made more than two years after that time limit.
(4)
The amount of the assessment must not exceed—
(a)
the amount of the unpaid tax, or
(b)
if less, the amount of tax which the other company saves by virtue of the surrender.
(5)
A company assessed to an amount of tax under sub-paragraph (2) is entitled to recover from the chargeable company—
(a)
a sum equal to that amount, and
(b)
any interest on that amount which it has paid under section 87A of the M1Taxes Management Act 1970 (interest on unpaid corporation tax).
(6)
For the purposes of this paragraph the chargeable company’s time limit for claims is the last of the dates mentioned in paragraph 74(1) on which the chargeable company could make or withdraw a claim for group relief for the accounting period for which the claim in question is made.
Assessment to recover excessive group relief
76
(1)
(2)
This power is without prejudice to—
(a)
the power to make a discovery assessment under paragraph 41(1);
(b)
the making of all such adjustments by way of discharge or repayment of tax or otherwise as may be required where a claimant company has obtained too much relief, or a surrendering company has forgone relief in respect of a corresponding amount.
F15(3)
If an assessment under this paragraph is made because a claimant company fails, or is unable, to amend its company tax return under paragraph 75(6), the assessment is not out of time if it is made within one year from—
(a)
the date on which the surrendering company gives notice of the withdrawal of consent, or (if later) sends a copy of a new notice of consent, to the claimant company under paragraph 75(3), or
Joint amended returns
77
(1)
The Treasury may by regulations make provision for arrangements under which—
(a)
a claim for group relief may be made without being accompanied by a copy of the notice of consent to surrender given by the surrendering company F16, provided authority for the claim being so made is given by a company which is authorised in relation to the claimant company as mentioned in paragraph (b), and
(b)
one company may be authorised to act on behalf of two or more companies in the same group in amending their company tax returns for the purpose of claiming or surrendering group relief or revising the amounts of group relief claimed or surrendered by them.
(2)
Regulations under this paragraph may add to, exclude or modify the operation of any provisions of this Part of this Schedule to such extent as the Treasury think necessary or expedient for the purpose of, or in connection with, such arrangements.
(3)
Provision may in particular be made—
(a)
altering the conditions for making and withdrawing claims for group relief, and
(b)
giving F5an officer of Revenue and Customs power to recover from the authorised company or another company in the group any amount which might be recovered from the claimant company by an assessment under paragraph 76.
F17Claims in respect of overseas losses of non-resident companies
77A
(1)
This paragraph applies if a claim for group relief is made in respect of any loss or other amount as a result of the condition in F18section 136 of the Corporation Tax Act 2010 being met (claims for group relief based on the EEA group condition).
(2)
In relation to the surrendering company, this Part of this Schedule applies as if—
(a)
references to the relief being surrendered were to the EEA amount and to the relief being claimed, and
(b)
references to its accounting period were to F19the accounting period that the company is assumed to have under section 125 of the Corporation Tax Act 2010 for the purpose of recalculating the EEA amount at Step 3 in section 113 of that Act.
(3)
Notice of consent of the surrendering company—
(a)
is to be given to the officer of the Board under paragraph 70(3)(b) by the claimant company (and not by the surrendering company), and
(b)
is to be given to the officer to whom the claimant company makes its company tax returns.
(4)
If the surrendering company is not within the charge to income or corporation tax, the requirement under paragraph 71(1)(e) for notice of consent by the surrendering company to contain details of its tax district reference is not to apply.
(5)
If notice of consent is withdrawn under paragraph 71, the notice of the withdrawal is to be given to the officer of the Board by the claimant company (and not by the surrendering company).
(6)
If notice of consent is withdrawn under paragraph 75—
(a)
the notice of withdrawal, and any copy of any new notice of consent, is to be sent to an officer of Revenue and Customs by the claimant company (and not by the surrendering company), and
(b)
any notice containing directions by an officer of Revenue and Customs under sub-paragraph (4) of that paragraph is to be given to the claimant company (and not to the surrendering company).
(7)
The remaining provisions of that paragraph, and the rest of this Part of this Schedule, are, accordingly, to be read with the appropriate modifications (so that, in particular, it is the claimant company (and not the surrendering company) which can bring an appeal under paragraph 75(7)).
(8)
A notice under F20paragraph 1 of Schedule 36 to the Finance Act 2008 (notice to taxpayer to produce documents etc) given to the claimant company may require the claimant company—
(a)
to explain why the EEA amount meets the conditions mentioned in F21Step 2 in section 113(2) of the Corporation Tax Act 2010 and is not prevented from being surrendered by section 127 of that Act, and
(b)
to provide details of the recalculation required under F22Step 3 in section 113(2) of that Act in relation to the EEA amount.
(9)
Except where expressly indicated, requirements imposed under this paragraph are in addition to those imposed apart from this paragraph.
(10)
In this paragraph “the EEA amount” has the same meaning as in F23Chapter 3 of Part 5 of the Corporation Tax Act 2010.