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HMRC internal manual

Company Taxation Manual

From
HM Revenue & Customs
Updated
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Corporation Tax: trading losses: general: entitlement to relief

CTA10/S36(3)

A company is only entitled to relief (CTM04050) for losses incurred while the company carrying on the trade is within the charge to CT in respect of that trade. A company is within the charge to CT if it is:

  • resident in the UK, or
  • not resident in the UK but carrying on a trade in the UK through a branch or agency.

So, if a non-resident company trading abroad:

  • becomes resident in the UK on a particular date, and
  • becomes chargeable to CT in respect of its trade from that date,

no relief from CT is allowed for any losses incurred earlier than that date.

A company not resident in the UK but trading in the UK through a branch or agency may only get relief for losses incurred by that branch or agency.