365Reduction of impairment loss debits where group relief claimedU.K.
(1)This section applies for any group accounting period for which there is a net consortium debit.
(2)For the purposes of this Chapter there is a net consortium debit for a group accounting period if—
(a)the total of the impairment losses and release debits brought into account for that period in respect of relevant consortium creditor relationships by—
(i)the member company, and
(ii)every group member,
exceeds
(b)the total credits so brought into account by them in connection with debts owed by the companies which are the debtor consortium companies in respect of those relationships.
(3)The net consortium debit is equal to that excess.
(4)If there is a claim for that group accounting period by the member company or a group member for group relief in respect of an amount which may be surrendered as group relief by the debtor consortium companies, the debits brought into account in respect of the impairment losses and the release debits mentioned in subsection (2)(a) are reduced.
(5)The amount of reduction in the case of each of the debits referred to in subsection (4) (“the relevant debits”) is calculated as follows.
Step 1
Find the total amount which—
(a)may be surrendered as group relief by the debtor consortium companies, and
(b)is claimed as group relief for the group accounting period by the member company or any group member.
Step 2
If the amount found at Step 1 does not exceed the net consortium debit, apportion the amount found at Step 1 between the relevant debits in proportion to their respective amounts.
If the amount found at Step 1 exceeds the net consortium debit, apportion so much of the amount found at Step 1 as does not exceed it between the relevant debits in proportion to their respective amounts.
(6)This section is subject to section 366.