Corporation Tax Act 2009

[F1 Use of losses U.K.

Textual Amendments

F1 Pt. 15C inserted (17.7.2014 for specified purposes and with effect in accordance with Sch. 4 para. 16 of the amending Act, 22.8.2014 in so far as not already in force) by Finance Act 2014 (c. 26), Sch. 4 paras. 1, 16; S.I. 2014/2228, art. 2

1217M Application of sections 1217MA to 1217MC U.K.

(1) Sections 1217MA to 1217MC apply to a company that is treated under section 1217H(3) as carrying on a separate trade in relation to a theatrical production.

(2) In those sections—

• “the completion period” means the accounting period in which the company ceases to carry on the separate theatrical trade;

• “loss relief” includes any means by which a loss might be used to reduce the amount in respect of which a company, or any other person, is chargeable to tax.

1217MA Restriction on use of losses before completion period U.K.

(1) Subsection (2) applies if a loss is made by the company in the separate theatrical trade in an accounting period preceding the completion period.

(2) The loss is not available for loss relief, except to the extent that the loss may be carried forward under section 45 of CTA 2010 to be set against profits of the separate theatrical trade in a subsequent period.

Modifications etc. (not altering text)

C1 S. 1217MA modified by 2010 c. 4, s. 357UF (as inserted (with effect in accordance with s. 5 of the amending Act) by Corporation Tax (Northern Ireland) Act 2015 (c. 21), s. 1)

1217MB Use of losses in the completion period U.K.

(1) Subsection (2) applies if a loss made in the separate theatrical trade is carried forward under section 45 of CTA 2010 to the completion period.

(2) So much (if any) of the loss as is not attributable to relief under section 1217H (see subsection (4)) may be treated for the purposes of loss relief as if it were a loss made in the completion period.

(3) If a loss is made in the separate theatrical trade in the completion period, the amount of the loss that may be—

(a) deducted from total profits of the same or an earlier period under section 37 of CTA 2010, or

(b) surrendered as group relief under Part 5 of that Act,

is restricted to the amount (if any) that is not attributable to relief under section 1217H.

(4) The amount of a loss in any period that is attributable to relief under section 1217H is found by—

(a) calculating what the amount of the loss would have been if there had been no additional deduction under that section in that or any earlier period, and

(b) deducting that amount from the total amount of the loss.

(5) This section does not apply to loss surrendered, or treated as carried forward, under section 1217MC (terminal losses).

Modifications etc. (not altering text)

C2 S. 1217MB modified by 2010 c. 4, s. 357UG (as inserted (with effect in accordance with s. 5 of the amending Act) by Corporation Tax (Northern Ireland) Act 2015 (c. 21), s. 1)

1217MC Terminal losses U.K.

(1) This section applies if—

(a) the company ceases to carry on the separate theatrical trade, and

(b) if the company had not ceased to carry on the separate theatrical trade, it could have carried forward an amount under section 45 of CTA 2010 to be set against profits of that trade in a later period (“the terminal loss”).

Below in this section the company is referred to as “company A” and the separate theatrical trade is referred to as “trade 1”.

(2) If company A—

(a) is treated under section 1217H(3) as carrying on a separate theatrical trade in relation to another theatrical production (“trade 2”), and

(b) is carrying on trade 2 when it ceases to carry on trade 1,

company A may (on making a claim) elect to transfer the terminal loss (or a part of it) to trade 2.

(3) If company A makes an election under subsection (2), the terminal loss (or part of the loss) is treated as if it were a loss brought forward under section 45 of CTA 2010 to be set against the profits of trade 2 of the first accounting period beginning after the cessation and so on.

(4) Subsection (5) applies if—

(a) another company (“company B”) is treated under section 1217H(3) as carrying on a separate theatrical trade (“company B's trade”) in relation to another theatrical production,

(b) company B is carrying on that trade when company A ceases to carry on trade 1, and

(c) company B is in the same group as company A for the purposes of Part 5 of CTA 2010 (group relief).

(5) Company A may surrender the loss (or part of it) to company B.

(6) On the making of a claim by company B the amount surrendered is treated as if it were a loss brought forward by company B under section 45 of CTA 2010 to be set against the profits of company B's trade of the first accounting period beginning after the cessation and so on.

(7) The Treasury may by regulations make administrative provision in relation to the surrender of a loss under subsection (5) and the resulting claim under subsection (6).

(8) “Administrative provision” means provision corresponding, subject to such adaptations or other modifications as appear to the Treasury to be appropriate, to that made by Part 8 of Schedule 18 to FA 1998 (company tax returns: claims for group relief).]

Modifications etc. (not altering text)

C3 S. 1217MC modified by 2010 c. 4, s. 357UH (as inserted (with effect in accordance with s. 5 of the amending Act) by Corporation Tax (Northern Ireland) Act 2015 (c. 21), s. 1)