‘Pre-entry’ capital losses

By Tolley
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The following Corporation Tax guidance note by Tolley provides comprehensive and up to date tax information covering:

  • ‘Pre-entry’ capital losses
  • Restrictions on use of pre-entry capital losses on company joining a group
  • Non-resident companies
  • Targeted anti-avoidance rules relating to capital losses

This guidance note summaries anti-avoidance rules that prevent a company from buying another company in order to use its capital losses. The rules, which were amended by Finance Act 2011, are summarised below.

TCGA 1992, Sch 7A
Restrictions on use of pre-entry capital losses on company joining a group

Pre-entry losses (defined further below) can only be set against gains on assets:

    More on Groups: