Chapter 22 Group Consortium Companies Flashcards
22.1 Definition and effect
A group consortium company is a consortium company which has its own 75% group. When computing consortium relief available to the members, it is deemed that any group relief claims that a consortium company could make within the consortium group has been made. It is therefore the net loss of the group, which is available to the group.
22.2 Group Relief claims made
Where an actual group relief claim has been made between the subsidiaries of the group consortium company, it can be taken into account when computing the deemed claim. This can increase the amount of loss available to the consortium members.
22.3 Consortium holding companies
The definition of a holding company for consortium relief is a company whose activity is wholly or mainly the holding of shares in 90% trading subsidiaries. When a company is a holding company loss can flow directly between the trading subsidiaries and the consortium members, based on the amount of the trading subsidiary loss, multiplied by the consortium member’s interest in the consortium holding company, on the proviso that the trading subsidiaries are UK resident. Where the subsidiaries are not UK resident, no losses can flow. Losses can also flow to or from the consortium members and the holding company as usual.
