Too literal

In yet another appeal in the long-running Marks & Spencer corporate losses case the company and HMRC could not agree on the treatment of losses.

By way of background M&S wanted to offset losses incurred by its EU subsidiaries against its UK profits by making group relief claims.

This was refused by the Revenue on the ground that losses from overseas subsidiaries could not be offset against UK profits.

After the Special Commissioners found for HMRC the High Court referred to the European Court of Justice for a preliminary ruling as to whether the domestic group relief provisions infringed EU law.

The ECJ said that they did not except where the non-resident company had exhausted the possibilities available to it in its own country with regard to past and future periods (the no-possibilities test).

The case was remitted to the High Court ...