Quite a startling colour; you can see how it got its common name.
One French author suggests adding the cups, with a little Kirsch, to a fresh fruit salad. Hmm. Maybe not. Actually, sources vary as to whether its edible so to be on the safe side I’d assume not.
Wikipedia has plenty of information on these species, including the fact that S. coccinea was used as a medicinal fungus by the Oneida Indians; after being dried and ground up into a powder, it was applied particularly to the navels of newborn children that were not healing properly after the umbilical cord had been severed. Wonder how they worked that one out. Not a tip we’re likely to make much use of.
Actually there are two related elfcups. Sarcoscypha austriaca commonly referred to as Scarlet Elfcup and the almost identical Ruby Elfcup Sarcoscypha coccinea) appears in winter on dead twigs in damp, shady places, usually partly buried in moss. Both like Hazel, which I think is what this was. It seems the best way to tell them apart is the hairy outer surface of the cups, which are covered in a matted felt (tomentum) of tiny uncoiled hairs in the case of Sarcoscypha coccineaand coiled (like a corkscrew) hairs in the case of Sarcoscypha austriaca but looking hard at the rim I’d guess ours is S.austriaca.