Corporation Tax Act 2010 section 133

Consortium conditions 2 and 3

Section 133 extends consortium group relief by allowing losses to be surrendered between a consortium-owned company and a company in the same group as a consortium member (the "link company"), subject to certain conditions.

• Consortium condition 2 allows losses to flow "upwards" from a consortium-owned surrendering company to a claimant company that is in the same group as a link company which is a consortium member, provided both companies are UK related.
• Consortium condition 3 allows losses to flow "downwards" from a surrendering company in the same group as a link company to a claimant company that is owned by the consortium, again provided both companies are UK related.
• In both cases, a "link company" connects the consortium and the group — it must be both a member of the consortium and a member of the same group as the other company involved in the claim.
• Neither condition is met if the link company holds its shares in the consortium-owned company as trading stock — that is, if a profit on selling those shares would be a trading receipt of the link company.