The ECJ issued a judgement on this case, concerning cross-border loss relief claims/surrenders, in 2005 but the UK courts are still considering the details of how to apply these principles. The ECJ determined that cross-border loss relief should be allowed when the lossmaking company has exhausted all possible claims in the state of residence and there is no possibility of relief being given in that state in future.

The UK Court of Appeal has now held that this test must be evaluated with regard to the facts of the claimant and not just with regard to the foreign tax law, based on the position at the time of the operative group relief claim. A number of other administrative matters were also determined.

HMRC is likely to seek permission to appeal to the Supreme Court, which could take until late December to determine. If granted, a Supreme Court decision would be likely to take until the fi rst quarter of 2013 be delivered.