Commentary

273 Trading losses and capital allowances

COMPANIES vol 11 acquisitions, mergers, demergers
| Commentary

273 Trading losses and capital allowances

| Commentary

(c) Capital allowances

273 Trading losses and capital allowances

When a company transfers a trade or part of a trade to another company and there is no change of ownership, the change is ignored for the purposes of capital allowances and the carrying forward of trading losses1. Consequently, assets qualifying for capital allowances are deemed to be transferred at the written down value and trading losses are carried forward and are available against subsequent trading income of the transferee company although the transferor company can claim the allowances against other profits.

There is effectively deemed to be no change of ownership if2:

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