New company loss rules to go ahead
As a result of the first Finance Act being rushed through due to the snap General Election, the legislation to introduce the new company loss relief rules were dropped. This led to considerable uncertainty as to the start date of the new rules. It has now been confirmed that the new rules will apply from 1 April 2017 after all.
So, if your company diversifies into a new business activity the losses of one activity incurred after 1 April 2017 can be carried forward and set off against future profits of the new business. Previously such losses would have been ring fenced against future profits of the activity that incurred the losses.
There are new restrictions for companies and groups with profits in excess of £5 million and also changes to the set off of losses within a group.
We can, of course, assist you in ensuring that relief for losses is obtained in the most beneficial way.