Corporation Tax Act 2010 section 188CI

Consortium condition 4

Section 188CI sets out the fourth consortium condition, which allows a company that is part of the same group as a consortium member to claim group relief for carried-forward losses from a consortium-owned surrendering company, using a "link company" to bridge the connection.

• The surrendering company must be a trading or holding company that is owned by a consortium, and both the surrendering and claimant companies must be UK related.
• The claimant company is not itself a consortium member but belongs to the same group as a consortium member known as the "link company".
• The condition is blocked if a sale by the link company of its shares in the surrendering company (or the relevant holding company) would produce a trading receipt rather than a capital gain.
• Where the consortium owns the surrendering company indirectly through a holding company, the share-sale test applies to the link company's shares in that holding company instead.