Corporation Tax Act 2010 section 188CG

Consortium condition 2

Section 188CG sets out "consortium condition 2", which allows carried-forward losses to be surrendered to a consortium-owned claimant company where the surrendering company is connected to the consortium through a link company in its group.

• The claimant company must be a trading or holding company that is owned by a consortium, and both the claimant and surrendering companies must be UK related.
• The surrendering company is not itself a consortium member, but belongs to the same group as a "link company" that is a consortium member.
• The condition fails if the link company would treat a profit on selling its shareholding in the claimant company (or the relevant holding company) as a trading receipt — this prevents the relief being used where the consortium interest is held as trading stock.
• This mirrors the equivalent rule for current-year group relief found in consortium condition 3 under section 133 of CTA 2010, but applies specifically to carried-forward losses.