Loss Relief for Single Companies

Question 1

What is a current period relief?

Answer 1

Claim to deduct the loss from current period total profits

Question 2

What is a carry back relief?

Answer 2

Claim to deduct the loss from earlier period total profits

Question 3

What is a carry forward relief?

Answer 3

Claim to deduct the loss usually from future period total profits

Question 4

When may a current period loss relief claim be made?

Answer 4

For a trading loss to be offset against total profits (e.g. before qualifying charitable doantions for current accounting period)

Question 5

When must current period loss relief claim be made?

Answer 5

Within two years of end of accounting period in which loss is made

Question 6

Trading loss for a carry back loss relief?

Answer 6

Can be carried back and offset against total profits of the preceding 12 months

Question 7

When must carry back loss relief claim be made?

Answer 7

Within two years of the end of the aqccounting period in which the loss is made

Question 8

Is a current period claim made first?

Answer 8

Yes

Question 9

How is a carry back ordered?

Answer 9

On a LIFO basis

Question 10

Carry back loss relief can only be carried back for?

Answer 10

A maximum of 12 months prior to the start of the loss-making period

Question 11

If an accounting period falls partly outside the 12 month period?

Answer 11

It’s total profits (before QCDs) must be pro-rated accordingly

Question 12

What may losses offset in current period or carried back may result in?

Answer 12

QCDs becoming unrelieved because such donations are deducted from total profits after this loss relief to compute taxable total profits

Question 13

Only way to get relief for unrelieved QCDs?

Answer 13

Group relief

Question 14

When is carry forward relief available? (unrelieved)

Answer 14

Loss remains unreleived after current period and carry back claim(s) have been made

Question 15

When is carry forward relief available? (no current)

Answer 15

No current period and carry back claims were made

Question 16

What will be carried forward to the next accounting period? (carry forward relief)

Answer 16

Any remaining losses

Question 17

What happens with carry forward relief (unlike current period and carry back claims)?

Answer 17

Company can make partial claims to prevent QCDs becoming unrelieved, or to save tax only at the highest rate

Question 18

If loss is not fully relieved in carry forward relief?

Answer 18

Remaining loss is automatically carried forward to the next accounting period and procedure is repeated until loss is fully relieved

Question 19

When must the claim to utilise the loss relieved be made for carry forward relief?

Answer 19

Within two years of the end of the accounting period