CFM32046 - Loan relationships: taxing and relieving provisions: reform of Corporation Tax loss relief: relaxation of non-trade deficits from loan relationships: summary
CTA09/PART5/CH16A
In most cases, non-trading loan relationship deficits (NTLRDs) incurred from 1 April 2017 can be carried forward and set against total profits of later accounting periods (CTA09/S463G and CTA09/S463I).
However, some carried-forward NTLRDs are still only available for set off against non-trading profits. This applies for all deficits arising prior to 1 April 2017 and to deficits of later periods if an investment business has become small or negligible or certain losses of an insurance company. (CTA09/S463H).
In addition, carried-forward NTLRDs incurred by a company that is a charity are still only available for set off against non-trading profits. Chapter 16A does not apply to these deficits (CTA09/S463A(1)(b)). Instead, they continue to be governed by the legislation at CTA09/PART5/CH16.
Setting NTLRDs against total profits of the deficit period and earlier periods
From 1 April 2017 for companies (excluding charities) the rules regarding setting NTLRDs against total profits of the deficit period and earlier periods are governed by legislation under CTA09/PART5/CH16A rather than CTA09/PART5/CH16. However the mechanics of the legislation have not changed.
- NTLRDs can be set against total profits in the deficit period (CFM32060) (CTA09/S463B(1)(a)).
- NTLRDs can be set against non-trading profits in earlier accounting periods falling within 12 months of the beginning of the deficit period (CFM32070) (CTA09/S463B(1)(b)).