Bank loss restriction: carried forward reliefs outside the restriction: overview apes 1/4/15 – 31/3/17
Accounting periods from 1 April 2015 to 31 March 2017
The bank loss restriction does not apply to the following carried forward reliefs:
- Carried-forward reliefs arising after 1 April 2015
- Carried-forward reliefs arising before a company begins relevant regulated activity (see BKM306400)
- Carried-forward reliefs arising to a new entrant bank in its start-up period (see BKM306500) or
- Carried-forward reliefs designated as unrestricted through the allowance for building societies (see BKM306700)
This means that the normal rules for those reliefs will apply for accounting periods from 1 April 2015 to 31 March 2017.
Under the normal rules:
- Carried forward trading losses will be available in full and used automatically against profits of the same trade in the calculation of total profits (CTA10/S45; CTM04100)
- Carried-forward non-trading loan relationship deficits will be available in full and used automatically against non-trading income in the calculation of total profits (CTA09/S457; CFM32040), subject to any claim under CTA09/S458(1) to carry all or part of the deficit forward to future periods (CFM32040)
- Carried-forward management expenses will be treated as management expenses of the current period and be available in full and used automatically and first of all against total profits in the calculation of taxable total profits (CTA09/S1223 and S1219).
Where these reliefs are available to a banking company which also has carried-forward reliefs subject to the restriction, the unrestricted reliefs will factor into the calculation of relevant profits in CTA10/S269CD. This reduces the amount of relevant profits available for relevant carried-forward relief.