Groups (2) Flashcards
What happens with a company which has a loss carried forward?
May transfer all or part of this loss to another member of the 75% group
What may the surrendering company may surrender carried forward?
Trading losses and/or property business income losses to other group companies under carry forward group relief
How does a current period group relief differ from a carry forward group relief?
A surrendering company can only surrender carried forward losses that it cannot deduct from it’s own total profits for current period
What must claimant company use in a carry forward group relief/
Use its own losses to the fullest extent possible in working out the available taxable total profits against which it may claim carry forward group relief
What may the carry forward group relief be set against?
Taxable total profits after all other reliefs for the current period but before relief for any amounts carried back from later periods
Obtaining loss relief by using current period group is?
Quicker than carry forward loss relief and so generally preferable to carrying forward the loss for cash flow reasons
If the surrendering company claims relief for loss against its own current period total profits?
Relief for qualifying charitable donations in that company may be wasted
How is group relief deducted?
After qualifying charitable donations in the claimant company, so relief for these donations is not lost
When does a chargeable gains group exists?
Where a holding company owns at least 75% of a subsidiary’s share capital
Two subsidiaries are at least 75% owned by same parent company
Where are sub-subsidiaries included/
If the ultimate parent company’s effective interest is over 50%
Can non-resident companies be included in a chargeable gains group?
Yes, but generally not participate in any reliefs
What is the definition of a chargeable gains group is wider than?
A 75% group as only an effective interest over 50% is needed compared to a 75% interest
Benefits of being in a chargeable gains group (neutral)
Asset transfer are tax-neutral
Benefits of being in a chargeable gains group (capital losses)
There is more chance of being able to use a group’s capital losses
Benefits of being in a chargeable gains group (rollover relief)
More chance of rollover relief being available
