Changes in cross border loss offset may be on the cards
In that case the Court ruled that the UK ban on cross border loss relief was disproportionate, in so far as it denied loss relief where a non-resident subsidiary had exhausted all possibilities for relief in its state of establishment. Following this ruling, the UK should in principle grant relief for definitive losses of a subsidiary established in another Member State.
In the legislation meant to implement the ruling, the UK imposed conditions on cross border group relief which make it virtually impossible for tax payers to benefit from the relief. The Commission consider that this is contrary to the EC Treaty.
Date: 13th October, 2008
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