{"id":276412,"date":"2025-06-06T04:42:55","date_gmt":"2025-06-06T04:42:55","guid":{"rendered":"https:\/\/peraltafinancing.com\/accounting\/corporation-tax-reform-of-loss-relief-whats-the-latest\/"},"modified":"2025-06-06T04:42:55","modified_gmt":"2025-06-06T04:42:55","slug":"corporation-tax-reform-of-loss-relief-whats-the-latest","status":"publish","type":"post","link":"https:\/\/fivemor.com\/?p=276412","title":{"rendered":"Corporation Tax Reform of Loss Relief: What\u2019s The Latest?"},"content":{"rendered":"


\n<\/p>\n

\n

The Corporation Tax reform of loss relief was originally announced in the Finance Bill, as published 20 March 2017, and was originally scheduled to come into force on 1 April 2017.<\/p>\n

The policy\u2019s aim is to make tax relief more flexible. It also aims\u00a0to ensure profitable businesses pay a fair amount of tax.<\/p>\n

As a result of the snap election and formation of a coalition government, however, the Corporation Tax reform of loss relief is now in limbo. In fact, the Finance Bill wasn\u2019t mentioned at all in the most recent Queen\u2019s Speech (2017)<\/a>.<\/p>\n

What are the proposed changes in the Corporation Tax reform of loss relief?<\/h2>\n

\"An<\/a>The Corporation Tax reform of loss relief<\/a> proposes that losses arising from 1 April 2017 and carried forward can be set against the total taxable profits of a company and its group members. This is called \u201closs relaxation\u201d as it offers a more flexible way for losses to be utilised.<\/p>\n

There is a second element to the proposed policy, called \u201closs restriction\u201d. If enforced, this will mean that the amount of profit that can be relieved with carried-forward losses is now restricted to 50% of the profits during the period. Furthermore there is an introduction of an annual allowance of \u00a35 million for companies or a group where losses can be used without the 50% loss restriction. It is expected that 99% of companies will be unaffected by the loss restriction due to the annual allowance available.<\/p>\n

What will the Corporation Tax reform of loss relief apply to?<\/h2>\n

These proposed changes to loss relaxation and restrictions will apply to trading losses, as well as:<\/p>\n