Creating a group for corporation tax trade losses

Creating a group for corporation tax trade losses

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I have a client they already run a Ltd company (Co. A), now would like me to set up another Ltd company to deal with a new income stream.(Co. B).

Company A is owned 75% between husband and Wife(say Bob and Sue) and 25% by an unrealted director shareholder(say Fred).  Company B will be owned 50:50 by Bob and Fred.

I have already advised about effects of associated company on tax bands etc.

My query is whether company A and B are in a group for trade losses as they are under common control.  Or does there have to be a Parent company above A and B for a group to be formed?

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By George Attazder
30th Jul 2012 16:19

GROUP!

A group for Corporation Tax Group Relief purposes is a parent company and its 75% subsidiaries.

Prima facie A and B aren't associated either, since they don't appear to be under common control on the information given.

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