Revenue and Customs v Marks and Spencer Plc: SC 22 May 2013

The company wished to assign losses in its European subsidiaries against its profits. Since the losses were first claimed, the subsidiaries had gone into insolvent liquidation.
Held: Lord Hope said: ‘I would answer the first issue by rejecting the alternative contended for by HMRC. I would hold that the question for inquiry is whether the claimant company has been able to show, on the basis of the circumstances known at the date when it makes its claim, that there has been no possibility of the losses in question being utilised in the Member State of the surrendering company in any accounting period prior to the date of the claim and no possibility of such utilisation in the accounting period in which the claim is made or in any future accounting periods. The consequence of this finding is that the third issue does not need to be answered. ‘
Lord Neuberger, President, Lord Hope, Deputy President, Lord Mance, Lord Reed, Lord Carnwath
[2013] UKSC 30, [2013] WLR(D) 191, [2013] STI 1899, [2013] 3 All ER 835, [2013] BTC 162, [2013] 1 WLR 1586, [2013] STC 1262, [2013] 3 CMLR 36, UKSC 2011/0241
Bailii, WLRD, SC Summary, SC
Finance Act 1998 Sch 18
England and Wales
At UTTCMarks and Spencer Plc v HM Revenue and Customs UTTC 21-Jun-2010
UTTC EUROPEAN LAW – group relief for losses of non-resident subsidiaries – whether there are no possibilities for those losses to be taken into account at the date of the group relief claim – date of valid claim . .
At FTTTXMarks and Spencer plc v Revenue and Customs FTTTx 2-Apr-2009
FTTTx EUROPEAN LAW – group relief for losses of non-resident subsidiaries – whether there are no possibilities for those losses to be taken into account at the date of the group relief claim – no at the date of . .
Appeal fromHM Revenue and Customs v Marks and Spencer Plc CA 14-Oct-2011
The taxpayers claimed relief for losses incurred within their European subsidiaries. The claim having been referred to the ECJ, Moses LJ summarised the issues outstanding: ‘(i) Is the test that the ECJ established to identify those circumstances in . .
CitedA Oy ECJ 21-Feb-2013
ECJ Freedom of establishment – Article 49 TFEU – Tax legislation – Merger of a parent company established in one Member State with a subsidiary established in another Member State – Deductibility by the parent . .
Reference to ECJMarks and Spencer Plc v Halsey (Inspector of Taxes) 2003
Marks and Spencer Plc appealed against the refusal of group relief, on the ground that the statutory limitations on the territorial scope of group relief were incompatible with, and overridden by, Community law. The Special Commissioners dismissed . .
At ECJMarks and Spencer v David Halsey (Inspector of Taxes) ECJ 13-Dec-2005
ECJ Articles 43 EC and 48 EC – Corporation tax – Groups of companies – Tax relief – Profits of parent companies – Deduction of losses incurred by a resident subsidiary- Allowed – Deduction of losses incurred in . .
See AlsoMarks and Spencer plc v Halsey (Inspector of Taxes) ChD 10-Apr-2006
The court considered the implementation of the ECJ decision between the parties.
Held: The matter was to be remitted to the Special Commissioners. The ‘no possibilities’ test referred to in the ECJ’s judgment required an analysis of the . .
See AlsoHalsey (HM Inspector of Taxes) v Marks and Spencer Plc CA 20-Feb-2007
The inspector appealed against a decision granting group relief to the taxpayer a UK resident company for losses by a group company in another European state.
Held: The appeal was denied. To refuse group relief in these circumstances would be . .
CitedOy Aa (Freedom of Establishment) ECJ 18-Jul-2007
ECJ Freedom of establishment – Corporate tax legislation – Ability of a company to deduct sums paid by way of intra-group transfer – Obligation on the transferee company also to have its establishment in the . .
CitedLidl Belgium GmbH and Co KG v Finanzamt Heilbronn ECJ 15-May-2008
ECJ Freedom of establishment Direct taxation Taking account of losses incurred by a permanent establishment situated in a Member State and belonging to a company which has its registered office in another Member . .

Cited by:
See AlsoRevenue and Customs v Marks and Spencer Plc SC 19-Feb-2014
For the purposes of corporation tax, MandS claimed group relief in respect of losses sustained by two of their subsidiaries, resident in Germany and in Belgium. Lord Hope observed that the claims were originally made and refused by HMRC over ten . .

Lists of cited by and citing cases may be incomplete.
Updated: 30 October 2021; Ref: scu.510005