Commentary

D7.4109 Unrelieved losses at transition

Corporate tax
Corporate tax | Commentary

D7.4109 Unrelieved losses at transition

Corporate tax | Commentary

D7.4109 Unrelieved losses at transition

Because the pre-2013 regime taxed the profits on the different categories of business separately, so losses on category could be carried forward only for offset against profits on the same type of business. Following the merging of permanent health insurance ('PHI') into non-BLAGAB business, it was recognised that streaming losses carried forward over transition was impractical and imposed a considerable compliance burden for little Exchequer benefit. The government therefore took the welcome step of simplifying the transition by effectively merging losses arising on gross roll up business and PHI losses into one to match the new non-BLAGAB business combined category.

Any unused losses on a company's gross roll up business arising in an accounting period ending before 1 January 2013 are carried forward into the new regime where they are available for relief against non-BLAGAB profits under CTA 2010, s 451.

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