If applying the M&S case, group relief is permissible between the UK and non UK EU subsidiaries of a common UK parent, we argue the same must apply if the common parent is resident outside the UK (e.g. in the Netherlands or the USA). To do otherwise would subject the UK subsidiary of the non UK parent to other or more burdensome tax in breach of the non discrimination article of the relevant DTC. HMRC disagree.
While finding against the DTC claims in the thin cap context Henderon J’s judgment concludes that our interpretation of the DTC is indeed correct in a manner which seems directly applicable to the group relief context.