Corporation Tax Act 2010 section 120

The qualifying loss condition: non-UK tax relief in another territory

Section 120 addresses the requirement that, for a loss to qualify for cross-border group relief, no tax relief must have been obtained in respect of the loss in any territory other than the EEA territory where the loss arose or the territory where the surrendering company is resident.

• This section prevents cross-border group relief where relief for the loss has already been given in a third territory — that is, a territory other than where the loss arose or where the surrendering company is resident.
• The check applies to relief obtained by any person, not just the surrendering company itself.
• Unlike the conditions in sections 118 and 119, this section only looks at relief that has actually been given, not relief that could potentially be claimed in the future.
• The restriction covers both deductions against taxable profits and any other form of tax relief available in the third territory.