Section 357EB — Corporation Tax Act 2010: Allocation of set-off amount within a group

Allocation of set-off amount within a group 357EB 1 This section applies where—

a there is a set-off amount in relation to a trade of a company for an accounting period, b the company is a member of a group, and c the set-off amount has not been reduced to nil by the operation of section 357EA(2).

2 The set-off amount (or so much of it as remains after the operation of section 357EA(2)) is to be reduced (but not to below nil) by any relevant IP profits of a trade of a relevant group member for the relevant accounting period.

3 For the purposes of this section—

a “ relevant group member ” means another member of the group that has made an election under section 357A(1) and is a qualifying company for the relevant accounting period, and b “ relevant accounting period ”, in relation to a company, means the accounting period of the company in or at the end of which the accounting period mentioned in subsection (1)(a) ends.

4 Section 357A does not apply in relation to so much of the amount of relevant IP profits of the trade of the relevant group member for the relevant accounting period as is equal to the amount by which the set-off amount (or so much of it as remains after the operation of section 357EA(2)) is reduced under subsection (2).

5 Where there is more than one relevant group member, the relevant group members may jointly determine the order in which subsection (2) is to apply to them.

6 If no determination is made under subsection (5), subsection (2) is to apply first to the trade that has the greatest amount of relevant IP profits of any trade of any of the relevant group members for a relevant accounting period, then to the trade that has the second greatest amount of relevant IP profits of any of those trades for such a period, and so on.