Global

Details

  • Service: Tax, International Corporate Tax, Global Compliance Management Services
  • Type: Regulatory update
  • Date: 9/28/2012

United Kingdom - Cross-border loss relief issue referred to CJEU 

September 28:  The European Commission this week announced it has referred the United Kingdom to the Court of Justice of the European Union (CJEU) with respect to the UK’s tax rules on cross-border loss relief.

The EC concluded that the UK has failed to properly implement the CJEU’s 2005 judgment in the Marks & Spencer case (C-446/03).


In 2005, the CJEU concluded that a parent company was not to be prevented from deducting the losses of its subsidiary established in another EU Member State if all other possibilities have been exhausted.


As noted by the EC (IP/12/1017, 27 September 2012), the UK amended its tax law after the judgment, but that the UK continues to impose conditions on cross-border group relief which the EC found makes it “very difficult to benefit from.”




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