Chapter 23 Group Administration Flashcards
23.1 Group Relief
Group relief must be made on the claimant company’s tax return. It must specify the amount, the surrendering company and the accounting period. The claim requires the written consent of the surrendering company and written consent from each member of the consortium in the case of consortium relief. The written notice of consent must specify the name of the company, name of the claimant, the amount, the accounting period and the tax district references of the surrendering and claimant company. The time limit for making and withdrawing group relief claims is the first anniversary of the filing date of the claimant.
The deductions allowance is determined via a group deduction allocation statement, there is a nominated company responsible for this. The statement must contain:
• Identification of the group to which it relates
• The accounting period of the nominated company
• A statement re the period for which the nominated company was the nominated company in that period
• The total amount of deductions allowable to the group
• A list of the members of the group
• The amounts of deductions allowance allocated to the group
• The accounting period of each of the group companies
23.2 Simplified Arrangements for group relief
The group can make an application for one company to deal with the group relief on behalf of the company. The application is made by the authorized company and signed by all the other members. The authorized company must wait 3 months after the submission, unless HMRC give consent for it to apply earlier. HMRC can refuse the application and also exclude companies from the arrangement.
The authorized company may have to provide a group relief schedule and is responsible for errors.
23.3 Group payment arrangements
A company can deal with tax payments for the whole group, they must inform HMRC of all the applicable companies.
23.4 Surrender of tax refunds
Companies can surrender overpayments within the group relief group. The companies must have the same accounting period and give joint notice in writing to surrender. The recipient company is treated as having paid the amount surrendered on the later of the date it was paid or the due date of payment. The surrendering company is treated as receiving a refund on the day.
