9: Corporation Tax, Groups And Losses

Question 1

4: Losses on change of ownership

Answer 1

If there’s a major change in the nature or conduct of the trade within the period 3 years before or 5 yrs afterwards

• no carry back of trading losses
• no carry forward of trading losses

Question 2

5: Which losses can be surrendered in the current period?

Answer 2

• Trading losses
• ntlr deficits
• Excess QCDs
• Excess property losses
• Excess management expenses

Question 3

5: Which brought forward losses can be surrendered?

Answer 3

• Trading losses
• NTLR deficits
• Property losses
• Management expenses

Question 4

5: Conditions to qualify for a group

Answer 4

Holding company owns at least 75%

Question 5

5: Maximum group relief

Answer 5

lower of:
- Company A’s loss
- Company B’s TTP for the same period

Question 6

6: Consortium Criteria

Answer 6

A consortium company is owned by a consortium if > 75% of its hsares are owened by companues (each own >5% and <75%)

Question 7

6: Losses within a consortium can be surrendered

Answer 7

Upwards or downwards

Question 8

7: Gain Groups Members

Answer 8

A group exists is there are at least 75% links between two or more companies and the holding company has more than 50% of any subs

Question 9

7: Reliefs available in a gains group

Answer 9

• NGNL transfers of assets between groups
• Transfer current period capital gains / losses
• Group rollover relief

Question 10

8 approach to groups questions

Answer 10

1. Drawn the group diagram
2. Calcualte TTP for each group company
3. Deal with gains group transfers
4. Determine how much relief

Question 11

9: De Grouping charges

Answer 11

Apply when a company leaves a group after being transferred an asset within 6 years.

DGC= the gain that would have arisen on the origianl NGNL transfer if it were MV.

Potentially exempt under SSE.