Jurisdiction(s):
United Kingdom

Related legal acts

Key definition

Group relief definition

What does Group relief mean? group relief is a corporation tax mechanism that lets one group company surrender specified losses or reliefs to another to reduce the claimant company’s taxable profits for overlapping accounting periods. It is legislated in the UK (Corporation Tax Act 2010, including the post‑2017 carried‑forward loss rules) and Ireland (Taxes Consolidation Act 1997, ss.420–423). Key features: - Available only where both the surrendering and claimant companies are within the charge to corporation tax and in the same 75% group throughout the relevant periods (with separate rules for consortium relief). - Surrenderable amounts typically include current‑period trading losses, non‑trading deficits on loan relationships,...

UK corporation tax group relief: defining loss relief groups (75% ownership, profits and winding-up tests), UK-related company rules, carried-forward losses, anti-avoidance and joint venture exceptions

Published by a LexisNexis Tax expert

Practice notes

Why does it matter?

Corporate groups are commonplace, i.e. multiple companies under shared Ownership. UK corporation tax is largely computed per company, which can, in certain cases, create inequitable tax outcomes for entities within the same group. As each company is taxed in isolation, outcomes may, in some cases, appear distortive and unfair for businesses within the same group. Consequently, the UK has introduced various tax provisions designed to remove or reduce these effects. Elsewhere, this can be addressed by taxing the whole group as a single entity. In the UK, by contrast, a suite of targeted measures grants defined reliefs to group members. Chief among these are the Group relief Rules, which permit companies in a group to surrender specified losses to other qualifying members, allowing groups greater flexibility in how losses are deployed than stand‑alone companies enjoy. This Practice Note sets out what constitutes a loss relief group for the purposes of the group relief regime and, since 1 April 2017, for the parallel rules on group relief for carried‑forward losses...

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Web page updated on 22/05/2026

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