Trading losses and anti-avoidance

Produced by a Tolley Corporation Tax expert

Corporation Tax

Guidance

Summary of trading losses anti-avoidance rules

There are several anti-avoidance rules involving the utilisation of trading losses which are summarised below:

Conditions	Consequences
Major change in nature or conduct of trade of the company, or the company’s activities become small or negligible (without a change in ownership of the company)	Trading losses arising after the change in ownership cannot be relieved against profits arising before the change and losses carried forward cannot be relieved against trading profits or total profits. Relief is lost completely. See below
Post-1 April 2017 change in ownership and major change in the business of the company	Losses eligible for carried forward relief against total profits are not available against post-change of ownership profits, including terminal losses. Relief is lost for five years. See below
Post-1 April 2017 change in ownership, and:	Trading losses available for carried forward relief, including terminal losses, are not available against the gain. Relief is lost for gains arising within five years. See Simon’s Taxes D1.1127
– no gain, no loss transfer within a group or tax neutral transfer

Continue reading the full document

To gain access to additional expert tax guidance, workflow tools, generative tax AI, and tax research, register for a free trial of Tolley+™

TAKE A FREE TRIAL NOW

Popular Articles

Personal Tax

Income tax losses ― overview

Income tax losses ― overviewIncome tax losses can arise due to a number of reasons, but not all losses can be relieved against total income and some losses can only be set against certain types of component income. The table below is a summary of the main reliefs for income tax losses.Summary of

04 Mar 2021 12:19 | Produced by Tolley Read more

Corporation Tax

Taxation of loan relationships

Taxation of loan relationshipsThe vast majority of companies will have loan relationships and so will need to consider how they are taxed under the loan relationship rules. There are also specific provisions dealing with relevant non-lending relationships and other deemed loan relationships.

14 Jul 2020 13:48 | Produced by Tolley Read more

Corporation Tax

Research and development (R&D) relief ― overview

Research and development (R&D) relief ― overviewThis guidance note provides an overview of the research and development (R&D) tax reliefs for companies.See the Research and development tax relief summary diagram which summarises the R&D tax relief.See also Simon’s Taxes D1.401.For a factsheet which

14 Jul 2020 12:22 | Produced by Tolley in association with Will Sweeney Read more

UU��ֱ��