Commentary

D7.508 Effects of a change of basis

Corporate tax
Corporate tax | Commentary

D7.508 Effects of a change of basis

Corporate tax | Commentary

D7.508 Effects of a change of basis

The rules in this division apply for accounting periods beginning before 1 January 2013. For accounting periods beginning on or after 1 January 2013 see Division D7.4.

Because companies now move automatically between an I-E and an actual trading basis the legislation needs to provide a mechanism to cater for losses and other reliefs brought forward to a period in which a company changes from one basis to the other. Although the rules are complex, their impact is likely to be relatively limited in day to day practice.

In the case of a company moving from an I-E to a trading basis, any loss arising in the earlier I-E basis period of account which is not set off elsewhere in the company,

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