Corporation Tax Act 2010 (c. 4)

Part 4 Loss relief

Chapter 2 Trade losses

Trade loss relief against total profits

38 Limit on deduction if accounting period falls partly within 12 month period

(1) This section applies if an accounting period falls partly within the period of 12 months mentioned in section 37(3)(b).

(2) The amount of the deduction for the loss for the accounting period is not to exceed an amount equal to the overlapping proportion of the company’s total profits of that period.

(3) The overlapping proportion is the same as the proportion that the part of the accounting period falling within the period of 12 months bears to the whole of the accounting period.