Corporation tax – Group relief for ATX-UK - part 2: self-test

Test your understanding

(1). K Co and FG Ltd are 100% subsidiaries of Q Ltd. K Co is resident in Australia. FG Ltd is resident in the UK but carries on all of its trading activities in Mexico.

Explain whether or not Q Ltd is able to surrender group relief to either or both of these subsidiaries.

(2). P Ltd and S Ltd are members of the WJ Ltd group. Their quarterly payments threshold is £187,500. Their taxable total profits are:

P Ltd – £195,000
S Ltd – £247,000

There are trading losses available for surrender to these two companies of £30,000.

To which company/companies should the trading losses be surrendered?