Corporation Tax Act 2009 section 368

Reduction of claims where there are earlier net consortium debits

Section 368 requires group relief claims surrendered by consortium companies to be reduced where there are excess loan relationship debits from earlier periods that have not already been offset.

• Where a group member claims group relief from a consortium company, the claim must be checked against the cumulative net consortium debits from earlier periods that have not already been reduced under the impairment loss rules
• If there is a single claim for the period and it exceeds the unreduced debits amount, the claim is reduced by that unreduced debits amount
• If there are multiple claims for the period and their total exceeds the unreduced debits amount, each claim is reduced by a proportionate share of the unreduced debits amount based on the ratio of that claim to the total of all claims
• In any other case — where a single claim does not exceed the unreduced debits amount, or where multiple claims in total do not exceed it — the claim is reduced to nil