In LINPAC Group Holdings Ltd v HMRC [2020] TC7556, the First Tier Tribunal (FTT) found that EU group relief claims did not replace earlier domestic claims to relief. The UK claims remained valid.

UK resident companies in a 75% group can surrender losses to fellow group members under domestic claims.

LINPAC Group Holdings Ltd (Holdings), a UK resident company, was a member of an international group comprising other UK companies and EU subsidiaries.

The FTT allowed the appeals:

The judge agreed with HMRC’s argument that the group had implied simplified group relief arrangements in place, despite the conditions for such arrangements never having been met.

He concluded that this did not matter as he had already found that the domestic claims had not been withdrawn. At the relevant times, when the various cross-border claims were made, the domestic claims could not be withdrawn without HMRC consenting to a late claim and they had not done so.

Links to our guides:

Losses: trading and other losses
When can a company offset its losses? What restrictions are there? 

Case Study 7: Creating a group
What are the steps for creating a group by way of a share for share exchange?

External link:

LINPAC Group Holdings Ltd v HMRC [2020] TC7556

Marks & Spencer v David Halsey (Case C‐446/03)

Commissioners for HM Revenue & Customs v Marks and Spencer plc (2013) UKSC 30