OT21053 - Corporation Tax Ring Fence and Supplementary Charge

Group Relief

Under ICTA88/s492(8), group relief is to be allowed against the claimant company’s ring fence profit only to the extent that the loss surrendered arises from ring fence activities.

It has been suggested that where a company has a ring fence profit and a non ring fence loss, a strict reading of the legislation means that the loss cannot be surrendered. This is not so. A company may surrender this downstream loss to a downstream company which is a member of the same group. Downstream means all operations taking place after crude oil is produced, such as refining, and marketing.