Taxes Consolidation Act 1997 section 420

Losses, etc which may be surrendered by means of group relief

Section 420 sets out the types of losses and other amounts that a group member may surrender by way of group relief to another group member.

• A surrendering company may transfer unused trading losses to a claimant company in the same group, to be set off against that company's total profits for the corresponding accounting period — but losses from foreign trades, uncommercial farming, or losses that would reduce a life company's policyholder profits cannot be surrendered.
• Excess capital allowances given by way of discharge or repayment of tax, or charged against Case V rental income, that are not absorbed by associated current income in the same period, may also be surrendered — but only allowances of the current period, not amounts carried forward.
• The excess of an investment company's current management expenses over its current period profits may be surrendered to a claimant company (which need not itself be an investment company), and the excess of charges on income paid in a period over the profits of that same period may similarly be surrendered.
• Where the claimant company is a member of a consortium, the amount that may be set off is restricted to a fraction equal to that member's proportionate share in the consortium, subject to any further reduction under section 422(2).

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