CTM80675 - Consortia: group relief: example: surrender by member of the consortium and by a member of its group, overlapping periods and company joining link company바카라 사이트檚 group
The consortium and group structure is as shown in the diagram at CTM80590.
The percentages shown in the diagram indicate beneficial ownership of ordinary share capital and you should assume that the arrangements rules (CTA10/Ss146A, 146B, and 155) do not apply.
The votes and entitlement to profits and assets on winding up follow the shareholdings shown (see CTA10/Ss151(4) for the 75%+ and 90%+ subsidiaries (CTM80535), and Ss143(3) and 144(3) for the ownership proportions of L and X in CH (CTM80540 and CTM80545)).
Apportionments are on a time basis (see CTM80260 for alternative methods).
Facts
CH is a company owned by members of a consortium L (60%) and X (40%). L is a 75% subsidiary of P. This part of the consortium and group structure has existed for many years.
CH draws up its twelve month accounts to 31 December. L and P both draw up their twelve month accounts to 30 June.
For its accounting period to 31 December 2010, CH has losses of 拢72,000.
For their accounting periods to 30 June 2011, P has profits of 拢20,000 and L has profits of 拢15,000.
S1 becomes a 75% subsidiary of P on 1 October 2010.
S1 Ltd has profits of 拢6,000 for its accounting period to 30 June 2011.
Each of P, L and S1 makes a consortium claim in respect of CH바카라 사이트檚 losses against its profits for the accounting period to 30 June 2011. They make the claims in the order L first, then P, and then S1 and ask for the claims to be dealt with in that order (CTM80220).
Procedure
The provisions about apportionment to overlapping periods and multiple claims (CTA10/Ss138 to 142 - CTM80215) interact with those about consortium shares (CTA10/S143 - CTM80540) and those about claims by group members CTA10/Ss133 and 145 - CTM80555.
L바카라 사이트檚 claim
The overlapping period (CTM80225)路is six months ended 31 December 2010.
CH바카라 사이트檚 바카라 사이트榮urrenderable amount바카라 사이트� for its accounting period ended 31 December 2010 is 拢72,000.
CH바카라 사이트檚 바카라 사이트榰nused part of the surrenderable amounts바카라 사이트� is the same as its 바카라 사이트榮urrenderable amount for the overlapping period바카라 사이트� (CTM80230). It is:
6/12 x 拢72,000 = 拢36,000
CTA10/S143 (2) (CTM80540) limits this to L바카라 사이트檚 ownership proportion. (In the rest of this example 바카라 사이트榦wnership proportion바카라 사이트� is referred to as 바카라 사이트榮hare바카라 사이트�.) This limit is:
60% x 拢36,000 = 拢21,600
L바카라 사이트檚 바카라 사이트榰nrelieved part of the claimant company바카라 사이트檚 available total profits바카라 사이트� is also the same as its 바카라 사이트榓vailable total profits for the overlapping period바카라 사이트� (CTM80235), as it has made no prior claims. It is:
6/12 x 拢15,000 = 拢7,500
The amount that can be surrendered/claimed is the smaller of 拢21,600 and 拢7,500: 拢7,500.
P바카라 사이트檚 claim
P can claim consortium relief because it is in the same group as the link company L, consortium condition 2 at CTA10/S133(1) and (3)-(8) applies (CTM80550).
The overlapping period is six months ended 31 December 2010.
The starting point for working out CH바카라 사이트檚 바카라 사이트榮urrenderable amount for the overlapping period바카라 사이트� is 拢36,000 as above. CTA10/S143(2) (CTM80540) limits the surrenderable amount for the overlapping period by reference to L바카라 사이트檚 share (CTA10/S145 (2) - CTM80555) of CH바카라 사이트檚 ordinary share capital. This limit is:
60% x 拢36,000 = 拢21,600
CH has made a prior surrender to L and so its 바카라 사이트榰nused part of the surrenderable amounts바카라 사이트� must take account of that. Following the steps in CTM80240:
STEP 1
L바카라 사이트檚 claim from CH involves part of CH바카라 사이트檚 surrenderable amount for accounting period ended 31 December 2010.
STEP 2
L바카라 사이트檚 prior claim of 拢7,500 was for the overlapping period of six months ended 31 December 2010.
The common period of the overlapping periods in L바카라 사이트檚 claim and P바카라 사이트檚 claim is six months ended 31 December 2010.
The whole six month overlapping period for L바카라 사이트檚 prior claim is included in the common period, so the whole of the 拢7,500 is apportioned to that common period.
STEP 3
The total, 拢7,500, is the 바카라 사이트榓mount of prior surrenders for the overlapping period바카라 사이트�.
So CH바카라 사이트檚 바카라 사이트榰nused part of the surrenderable amounts바카라 사이트� is 拢21,600 less 拢7,500 which is 拢14,100.
P바카라 사이트檚 바카라 사이트榰nrelieved part of the claimant company바카라 사이트檚 available total profits for the overlapping period바카라 사이트� is the same as its 바카라 사이트榓vailable total profits for the overlapping period바카라 사이트�, as it has made no prior claims. It is:
6/12 x 拢20,000 = 拢10,000
The amount that can be surrendered/claimed is the smaller of 拢14,100 and 拢10,000: 拢10,000.
S1바카라 사이트檚 claim
As with L and P, the six month period from 1 January 2011 to 30 June 2011 does not overlap with CH바카라 사이트檚 accounting period ended 31 December 2010. In addition, for the three-month period to 1/ October 2010 S1 was not in a group relationship with the link company L. So it was not in the same group with L for that time and CTA10/S142(2) (CTM80555) applies to prevent that three months from being part of an overlapping period. So the overlapping period is the three months ended 31 December 2010.
The starting point for working out CH바카라 사이트檚 바카라 사이트榮urrenderable amount for the overlapping period바카라 사이트� is:
3/12 x 拢72,000 = 拢18,000
As with P above, CTA10/143(2) limits this by reference to L바카라 사이트檚 share of CH바카라 사이트檚 ordinary share capital (CTA10/S145(2)). This limit is:
60% x 拢18,000 = 拢10,800
CH has made a prior surrender to L and P and so its 바카라 사이트榰nused part of the surrenderable amount for the overlapping period바카라 사이트� must take account of that. Following the steps in CTM80240:
STEP 1
L바카라 사이트檚 claim from CH involves part of CH바카라 사이트檚 surrenderable amount for accounting period ended 31 December 2010.
P바카라 사이트檚 claim from CH involves part of CH바카라 사이트檚 surrenderable amount for accounting period ended 31 December 2010.
STEP 2
L바카라 사이트檚 prior claim of 拢7,500 was for the overlapping period of six months ended 31 December 2010.
The common period of the overlapping periods in L바카라 사이트檚 claim and S1바카라 사이트檚 claim is three months ended 31 December 2010.
The 拢7,500 is apportioned to that common period:
3/6 x 拢7,500 = 拢3,750
P바카라 사이트檚 prior claim of 拢10,000 was for the overlapping period of six months ended 31 December 2010.
The common period of the overlapping periods in P바카라 사이트檚 claim and S1바카라 사이트檚 claim is three months ended 31 December 2010.
The 拢10,000 is apportioned to that common period
3/6 x 拢10,000 = 拢5,000
STEP 3
The total 拢8,750 (拢3,750 plus 拢5,000) is the 바카라 사이트榓mount of prior surrenders for the overlapping period바카라 사이트�.
So CH바카라 사이트檚 바카라 사이트榰nused part of the surrenderable amounts바카라 사이트� is 拢10,800 less 拢8,750 which is 拢2,050.
S1바카라 사이트檚 바카라 사이트榰nrelieved part of the claimant company바카라 사이트檚 available total profits바카라 사이트� is the same as its 바카라 사이트榓vailable total profits for the overlapping period바카라 사이트�, as it has made no prior claims. It is:x
3/12 x 拢6,000 = 拢1,500
The amount that can be surrendered/claimed is the smaller of 拢2,050 and 拢1,500: 拢1,500.
CTA10/S146(2) and (3)
The last stage is to determine the maximum amount that can be allowed to L, P, and S1 taken together. The calculation of the maximum amount is by reference to the amount that L could claim if it had sufficient profits and was UK related (CTM80555). That amount is 拢21,600 (L바카라 사이트檚 share of CH바카라 사이트檚 surrenderable amount). The total 拢19,000 claimed by L (拢7,500), P (拢10,000), and S1 (拢1,500) is less than this, so no further restriction is needed.
Note that if any of CT1, CT2, or CT3 had profits then CTA10/S148 (CTM80580) would apply to reduce CH바카라 사이트檚 losses available for surrender. This is because CH is both owned by a consortium and is a member of a group and there is the potential for CT1, CT2, and CT3 to make group claims in respect of its losses. CH바카라 사이트檚 losses of 拢72,000 would be reduced by the total amount of the maximum group claims possible after taking into account any actual surrenders by other companies in the group. See CTM80685.