Corporation Tax: trading losses - relief against total profits: preceding accounting periods: examples showing later profits relieved before earlier
Company H made a trading loss of £35,000 in the accounting period 1 January 2001 to 31 December 2001. Other CT profits of this period amounted to £20,000. The company continues to trade. The CT profits of earlier accounting periods were as follows.
|1 July 2000 to 31 December 2000||£10,000|
|1 July 1999 to 30 June 2000||£20,000|
The trade in which the loss was incurred was carried on throughout the whole of the period from 1 July 1999 to 31 December 2001.
Company H claims relief under CTA010/S37 to extend to the profits of accounting periods within the ‘preceding period’. The ‘preceding period’ is the twelve months ending on 31 December 2000.
Relief is given as follows.
|Against profits of the accounting period to 31 December 2001||£20,000|
|Against profits of the accounting period six months to 31 December 2000||£10,000|
|Against profits of the accounting period twelve months to 30 June 2000||£5,000|
|Total amount of profits relieved||£35,000|