A company may surrender up to 70% of its current year adjusted losses to a related company, to be set off against the claimant company’s income, where both companies have a twelve (12) month basis period ending on the same date.
Prior to the Year of Assessment 2019, there is no limit to the number of years that a company can surrender its losses, as long as applicable conditions are met.
Group relief will not apply to a surrendering or claimant company for a basis period for a year of assessment, where the company is enjoying the Investment Tax Allowance or Pioneer Status incentives.
However, the company will still be eligible to participate in group relief if the Investment Tax Allowance or Pioneer Status incentive periods have expired.
With effective from the Year of Assessment 2019 following amendments to Section 44(A) of the Income Tax Act 1967, there are significant tightening of the group relief provisions, as follows:
If you need further clarification, please do not hesitate to contact our tax team.
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