Division D7.3 Companies with investment business, investment companies and investment trusts

Commentary

D7.320 Restriction on carry forward of certain expenses and losses of investment businesses

Corporate tax
Corporate tax | Commentary

D7.320 Restriction on carry forward of certain expenses and losses of investment businesses

Corporate tax | Commentary

Change of ownership of company with investment business

D7.320 Restriction on carry forward of certain expenses and losses of investment businesses

There may be a restriction on the carry forward of surplus management expenses where there is a change of ownership of a company with investment business1. The rules are similar to, but not identical with, the rules restricting carry forward of trading losses (see D1.1126) and losses of a property business (see B6.203) on a change of ownership of the company concerned.

What constitutes a change in ownership?

There is a change in the ownership of a company if2:

  1.  

    •     one person acquires more than half of its ordinary share capital, or

  2.  

    •     two or more persons acquire more than half of the ordinary share capital and each of them acquires at least 5%, or

  3.  

    •     two or more persons acquire

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