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HMRC writes to cross-border group relief claimants

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Deloitte has reported that HMRC has started to issue letters to companies affected by the approach it has decided to take on pre-2006 cross-border group relief claims in the light of the CJEU decision taken in February, asking them to consider withdrawing some of the claims they have made. According to Deloitte, HMRC has taken the view that ‘the Supreme Court’s decision in Marks & Spencer has effectively been overruled, as courts and tribunals would be bound to follow the CJEU’, and that most of these cross-border group relief claims will fail ‘because taxpayers cannot satisfy the ‘no possibilities’ test at the end of the accounting period in which the losses were sustained’. HMRC’s letter has asked taxpayers to respond by 5 June 2015.