Corporation Tax: trading losses - relief against total profits: restrictions for farming companies - commencement and cessation
CTA10/S48 (CTM04710) does not deny relief under CTA10/S37 where a company’s trade of farming or market gardening was set up and commenced within the period of five years before the beginning of the accounting period for which relief is claimed.
- the company has succeeded to the trade, and
- the predecessor’s trade has not been treated as discontinued for the purposes of capital allowances and charges because of CTA10/S940A,
the trade is treated as a continuous trade for S48 purposes.
There is guidance on CTA10/PART 22/CHAPTER 2 at CTM06000+ which deals with company reconstructions without change of ownership. See BIM85635 for companies controlled by a spouse where a trade transferred between the parties is a continuous trade.