Use of carried forward company lossesMake Text Bigger
Hi Mark, I have used the services of Property118 previously for tax planning advice.
I have a company that is no longer trading (but still active) that is sitting on a £20,000 of losses and I was wondering if the losses of this company could be set against any potential future gains if I was to change this company to a property rental business?
Thanks and keep up the good work!
Response from Mark Smith, Property118 Hon Legal Counsel
This link should give further guidance.
Carry forward a trading loss
Your company can carry trading losses forward to deduct from profits of future accounting periods as long as the trade continues.
If your company is using a carried forward trading loss in an accounting period that ends before 1 April 2017, you can only use the relief against profits of the same trade.
Where your company is using a carried forward trading loss in an accounting period that starts on or after 1 April 2017, the situation depends on when your company made the loss in question. If your company made the loss:
- before 1 April 2017, it can only be used against profits of the same trade
- on or after 1 April 2017, it can normally be used against your company’s total profits
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