OT66010 - Transferable tax history - TTH allocation on a loss carry back - Introduction
The guidance below sets out how a loss of a purchaser can be set against TTH. It covers the rules for allocating activated TTH amounts to accounting periods in accordance with Part 6 of FA19\Sch15. The steps set out in that part are a mechanical way of working out what profits a loss can be set against and those steps are detailed in the following pages.
There are a number of key principles to bear in mind when it comes to allocating activated TTH:
- Allocation is only done for an accounting period where the purchaser makes a decommissioning loss (see OT63030) that it is carrying back in accordance with CTA10\S39, S40 or S42.
- Amounts allocated in a previous accounting period are not treated as still being allocated in subsequent accounting periods where an allocation is made.
- Amounts of activated TTH that have been allocated and used in accordance with Part 4 of the Schedule in an accounting period do not get reallocated in the next loss-making accounting period.
- Amounts of activated TTH that have been allocated but not used in accordance with Part 4 of the Schedule in an accounting period do get reallocated in the next loss-making accounting period.
The process for allocating amounts of activated TTH is different depending on whether it is the first loss-making accounting period, or a subsequent one.