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HMRC internal manual

Banking Manual

Bank loss restriction: targeted anti-avoidance rule: effect where the TAAR applies


Where the three conditions are met (see BKM307100) the company will not include the amount of profits that meet condition A when performing its calculation of relevant profits under CTA10/S269CD.  This effectively means that the banking company cannot use any of its relevant carried-forward losses against the amount of increased profits from the arrangement.


Company A has £5m of pre-2015 carried-forward non-trading deficits.  It enters an arrangement meeting the conditions in CTA10/S269CK in order to access these losses.

The arrangement gives rise to £1m of additional non-trading profits in company A.  In the absence of the arrangement company A would not have these profits.

CTA10/S269CK(8) means that when company A calculates its relevant non-trading profits it will not include the £1m.  The company will not be able to use any pre-2015 carried-forward non-trading deficits against the extra £1m arising from the arrangement.