BIM64395 - Measuring the profits (particular trades): Private finance initiative (PFI): ICTA88/S413 - group relief
In many PFI projects the private sector operator is a consortium company. That is:
- a directly held company owned by the consortium members, or
- a company owned 90% by a consortium holding company as defined by ICTA88/S413 (3)(b).
Where losses arise in a consortium company, group relief will be available where the consortium company is a “trading company”, that is “a company the business of which consists wholly or mainly in the carrying on of a trade” (see BIM64385).
If a consortium company is a “trading company”, any Schedule A losses (as from 1 April 1998) will be capable of being surrendered as consortium relief assuming that all the other relevant conditions are met.
