# Finance Act 2026, Paragraph 37: Domestic top-up tax: covered tax to include group relief payments

Extent: E+W+S+N.I.

In subsection (8)—
(a) after paragraph (a) insert—
“(aa) section 138 (profits adjusted to be before tax) has effect as if at the end of subsection (2) there were inserted—
“(g) a group relief payment so far as excluded (and for that purpose “group relief payment” and “excluded” have the meaning given in section 173(3)).”;
(ab) section 173 (covered taxes) has effect, subject to paragraph (f) below, as if (in addition to the modification made by subsection (4)(a))—
(i) in subsection (1), the “and” after paragraph (c) were omitted and after paragraph (d) there were inserted
“, and
(e) a group relief payment so far as it is not excluded.”;
(ii) at the end there were inserted—
“(3) For the purposes of subsection (1)(e)—
(a) “group relief payment” means a payment—
(i) in relation to which section 183 or 188FA of CTA 2010 applies to the member, and
(ii) that relates to group relief which the member claims under section 130 or 188CB of that Act by virtue of the group condition being met (see sections 132 and 188CE of that Act);
(b) a group relief payment is “excluded” so far as it exceeds 15% of the agreed loss amounts (within the meaning of section 183 or 188FA of that Act, as the case may be) to which the group relief payment relates.
(4) It follows from subsection (1)(e) that a group relief payment, so far as not excluded, operates to reduce the covered tax balance of the recipient.””;
(b) at the end insert—
“(f) section 239(4)(a) (location of entities: tie-breaker by reference to covered taxes) has effect without the modification made by paragraph (ab).”

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Source: https://www.legislation.gov.uk/ukpga/2026/11/schedule/8/paragraph/37 (the official version)
Page: https://openlegislation.uk/finance-act-2026/schedule-8/paragraph-37
Contains public sector information licensed under the Open Government Licence v3.0. Source: legislation.gov.uk, The National Archives.