CTM80560 - Consortia: group relief: surrender by company in consortium member’s group

ICTA88/S406 (1) and (5) to (8)

For the meaning of terms used in this paragraph see CTM80550 and for a diagram illustrating them see CTM80590.

A company owned by a consortium (a 'consortium company') can make a consortium claim in respect of the losses etc. incurred by a company which is a member of the consortium member's group (a 'group member’).

The effect is:

• the consortium company can make any such claim as if the group member incurring the losses etc. stands in the shoes of the link company - ICTA88/S406 (5).
• for the purposes of determining the share of the consortium company’s total profits that can be covered by consortium relief under ICTA88/S403C (3) ( CTM80545), the ‘relevant fraction’ taken is that which the link company has in the consortium company in the period which is the overlapping period in the claim - ICTA88/S406 (6).
• that overlapping period excludes any time when the group member is not in a group relationship with the link company.
• Where more than one claim is made by a consortium company, the maximum amount which all group members, including the link company, can surrender in total to the claimant is the amount which could have been surrendered by the link company itself, if it had sufficient losses etc. and the same accounting period as the claimant - ICTA88/S406 (4).

Bear in mind that the rules about:

• apportionment of amounts to overlapping periods ( CTM80215) in ICTA88/S403A,
• the amount of relief where group relief may be available from a fellow group member in addition to consortium relief in ICTA88/S405 ( CTM80580),

may apply as well as ICTA88/S406.

See the example at CTM80675.