Without provision to the contrary, a loss -making company could be sold to a profitable group in order to shelter profits from tax. Anti-avoidance rules therefore. Under current rules , where there is a change in ownership of a loss making company, in addition to the usual restrictions on offset of trading losses against future profits arising from the same trade, there is a further restriction where, within years following the change in ownership, there is a major change in the. Dec To counter ” loss - buying ,” under current legislation where a company suffers a major change in the nature or conduct of its trade within three years of a change of ownership, any trading losses at the date of ownership change are lost.
Additional provisions deal with companies with investment business. Mar To counter loss - buying , there are current rules in place which prevent trading losses in existence at the date of a change in ownership being .
Targeted anti-avoidance loss buying rules : exclusion of Research and Development Allowances. Who is likely to be affected? Non-trading companies that have . Feb Trade losses can be carried forward against total profits of the company, and not just.