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HMRC internal manual

Company Taxation Manual

Consortia: group relief: arrangements: definitions

CTA10/S155(4) and CTA10/S156(3)

The meanings of ‘third company’ and ‘successor’ for the purposes of arrangements that disqualify consortium relief (CTM80605) are set out below.

Third company

This means a company which, ignoring the effect of any arrangements such as are described in CTM80605, is not a member of the same group as the holding or trading company in CTA10/S155(4) to which the arrangements refer.


One company is a successor of another if it carries on, in whole or in part, a trade which the other company has ceased to carry on in certain circumstances where a balancing charge would not be chargeable on the ceasing company. The circumstances are where:

  • CTA10/Part 22/Chapter 1 (company reconstructions without change of ownership) applies to the two companies (CTM06000 onwards), or
  • the two companies are connected within the meaning of CTA10/S1122 (CG14532 onwards).


“Arrangements”, defined at CTA10/S156(2):

  1. means arrangements of any kind (whether or not in writing), but
  2. does not include a power of a Minister of the Crown, the Scottish Ministers or a Northern Ireland department to give directions to a statutory body as to the disposal of assets belonging to the body or to a subsidiary of the body.

For accounting periods ending on or after 1 April 2013 (b) is extended to include:

  • A condition or requirement imposed by or agreed with a Minister of the Crown, the Scottish Ministers, or a Northern Ireland department