CTM80220 - Groups: group relief: non-coinciding accounting periods or group relationships - order of dealing with claims

ICTA88/S403A (6) and (7)

There is a broad overview of Section 403A at CTM80210 and more detailed guidance at CTM80215.

Sections 403A (6) and (7) contain the statutory rules for determining the order of dealing with multiple claims to group relief.

Section 403A (6) provides that each claim is to be dealt with on the basis that, at the time that particular claim becomes incapable of withdrawal,

• every other claim that becomes incapable of withdrawal before that time is a claim made before the particular claim, and
• every other claim that can still be withdrawn at that time is a claim made after the particular claim.

Where as a result of this rule, claims are deemed to have been made at the same time, Section 403A (7) provides that the companies may choose the order in which claims are dealt with. If the companies do not choose an order, the Revenue may direct the order.

Under CTSA this may lead to uncertainty, at the time the claims are made, about the order in which they are to be dealt with. This is because whilst the FA98/SCH18/PARA74 (1)(a) time limit for withdrawing claims is certainly known at the time of claim, other matters may extend the time limit. For instance FA98/SCH18/PARA74 (1)(b) may extend the time limit if the Revenue enquire into a return and the possibility of such extensions may not be known at the time of claim.

In practice you should deal with claims in the order in which they are made and not insist on a full reworking of all the claims affected by some later event. You should, however, follow the statutory rules strictly, for all the group companies affected, if any of the claimant or surrendering companies ask for this.