Corporation Tax self-assessment (CTSA): the payment obligation: carry-back of trading losses or non-trading deficit - late payment interest - example 3
|Accounting period 1.1.94 to 31.12.94||Accounting period 1.1.96 to 31.12.96|
|CT profit||£40,000||Trade loss £20,000|
|CT liability||£10,000||ICTA88/S393A claim to carry back to accounting period ended 31.12.94. (No profits for the accounting period ended 31.12.95.)|
|less ACT of the accounting period||£ 8,000|
|CT payable paid by due date||£ 2,000|
|Liability after carry-back becomes profit||£40,000|
|Less loss carry-back||£20,000|
|Profit chargeable to tax||* * *|
|Tax @ 25%||£ 5,000|
|Less ACT of the accounting period||£ 5,000|
|Tax payable||* * *|
The £2,000 CT paid is repayable.
The carry-back has no consequences for late payment interest. No additional amount of CT would have carried interest if the claim had not been made.
Note: COTAX will incorrectly charge interest in such a case, see (b) of CTM92420.