UK and International Tax news

HMRC Issues Draft Guidance On Corporation Tax Loss Relief Reform

Friday 8th September 2017

HMRC has recently issued draft guidance on its proposals for the reform of corporation tax loss relief.

The reform of corporation tax loss relief will be introduced in a second 2017 Finance Bill [F(No 2)A17] and has two aims:

  • to restrict the amount of loss relief available to businesses with substantial profits, and
  • to allow most carried-forward losses arising from 1 April 2017 to be used more flexibly against the total taxable profits, rather than particular types of profits, of a company and its group members.

The government had previously confirmed that the legislation will be included in a Finance Bill to be introduced after the summer recess and an amended draft of the legislation was published on 13 July 2017.

HMRC’s initial tranche of guidance focuses on the core rules and other aspects where guidance has been specifically requested. Amended and further draft guidance will be issued in due course.

HMRC has requested comments on the draft guidance by 25 September 2017 and the draft guidance will be updated as necessary in the light of comments received.

 

For further information on the draft guidance, please contact Keith Rushen on 0207 486 2378.

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