Corporation Tax Act 2010 section 188DJ

Condition 2: companies in link company's group

Section 188DJ limits the total group relief for carried-forward losses that a claimant company can receive from a link company and other members of the link company's group, where the claim is based on consortium condition 2.

• Where a claimant company claims group relief for carried-forward losses based on consortium condition 2, the total relief from the link company and its group is capped
• The cap is the same proportion of the claimant company's relevant profits as would apply under the ownership proportion rules if the link company were UK related
• For the purpose of calculating this cap, it is assumed that the link company's accounting period is the same as the claimant company's accounting period
• This rule aggregates all consortium claims relating to losses surrendered by the link company and any companies in the link company's group, ensuring total relief does not exceed the ownership proportion limit