Liquidating a loss corporation
A claim should be made within 2 years of the end of the accounting period when you made the loss.Your claim should include: can ask about the usage of the loss in a future return - for example, to check whether the same trade is still being carried out.You don’t have to make any claim for this to happen.
HM Revenue and Customs () has announced a temporary extension to the loss relief rules for trading losses.
For example, if your company or organisation has a loss of £8,000 in the accounting period 1 January 2010 to 31 December 2010 and profits of £20,000 in the preceding 12 months, you can carry back the £8,000 loss to be set off against the profits for the previous accounting year, reducing them from £20,000 to £12,000.
But, if an accounting period straddles that 12-month period, the profit for that period is apportioned and the loss can only be offset against that portion of the profit falling within the 12-month period.
But for each year, you can only offset the loss against the profits in that year if your company or organisation was carrying on the same trade at some point in the accounting period or periods that fall in that year.
If the accounting period end date has changed, or any of the preceding accounting periods in that 3-year period are less than 12 months, then you’ll have to apportion the profit.