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Group relief—introduction and scope

D2.201A Group relief—overview

Group relief is a mechanism that allows for the transfer of certain types of losses (and other expenses) from loss-making members of a group of companies to members that are profitable. The basic premise behind the relief is to allow members of a group to effectively be taxed as one economic unit for a given accounting period.

The meaning of what constitutes a group for group relief purposes is explored in detail at D2.205.

It should be noted at the outset that the application of the group relief rules is limited to corporate ownership. Therefore losses cannot flow between individuals and companies under the group relief or consortium relief rules.

The group relief provisions enable relief for current year losses and certain carried forward losses to be transferred to other profit-making companies within the group. The types of losses and expenses that are eligible for group relief is considered at D2.209.

The company that transfers the losses within the group