Tax Relief for Group Companies 2018
HMRC has introduced a regulation to help group companies make use of the new carry forward loss relief. How and when can you make use of the simplification?
Loss relief changes. 2017 was a confusing year for tax. It included the move from a spring to an autumn Budget, no less than four Finance Bills and deferred changes to legislation, most of which were later reintroduced, while a few were amended or scrapped. There were important changes to the “corporate loss relief” rules.
Carried forward losses. As you’re probably aware, the two big changes were a cap on the relief for large companies and the entitlement to set losses (which arise from 1 April 2017) against the company’s total income for later years. Previously, losses carried forward to later years could be set only against profits of the same trade to which they related. For loss-making group companies, this usually meant that losses which were carried forward couldn’t be used by other companies.
New regulations. To help companies make use of the new carry-forward relief, HMRC has created a new regulation, which took effect on 30 January 2018. Its purpose is to extend the scheme (which was only for loss relief which hadn’t been carried forward) to allow each company within a group to nominate one of them to handle claims for loss relief in respect of carried forward losses for all of them. However, if you want to use this simplification you must obtain an agreement from HMRC first.
Jibran Qureshi FCCA is the Managing Director of Clear House Accountants, and has over 10 years of experience in practice and across multiple industries. Jibran’s educational background includes a Master’s in Financial Strategy from Oxford University and an Executive MBA from Hult International Business School. His experience in Financial Strategy, Tax Planning, Operational Consultancy and Performance Reporting guide his cognizant approach to leading Clear House and its clients to the future. It was this dexterity that led him to be Enterprise Nation’s Top 50 Advisors.
Jibran is fueled by his passion for helping businesses. He unequivocally believes that as business advisors and accountants for our clients, it is our responsibility to work with them as business partners. As specialists, it is our duty to help our clients navigate through the complexities of constant change and the implications that come with it.
Over the past decade, innovative disruptions have changed the way businesses work, everything from cloud software, innovative business models, to AI and machine learning, have impacted how businesses operate, grow, and expand.
Jibran recognized the need to manage these disruptions sustainably, early on and shaped Clear House Accountants to not just be compliance specialists, but advisors who help build complex ecosystems around cloud accounting software, provide advice on funding support, help manage innovative tax schemes, set up and implement complex strategic plans, and much more. So, his clients can thrive, not just survive.
Jibran developed his prime role as the Managing Director to build Clear House’s capabilities so it can add value for their clients. He is of firm belief that this can be done through consistent high-level training, building the right tools, and creating roadmaps to help businesses cope with prospective disruptions. He envisages that every client that comes on board, is provided maximum value through onboarding, ongoing services and the right mix of tools to help them become the best in the world.