On January 26, 2017 the UK Government published several pieces of draft legislation that are supposed to take effect as per April 1, 2017. The subjects of these pieces of draft legislation include a.o.:

·   relief for carried-forward losses

·   corporate interest restriction

 

Relief for carried-forward losses

This measure reforms the tax treatment of certain types of carried-forward loss for corporation tax purposes. The legislation is supposed to take effect from April 1, 2017.

The reform has two aspects:

·   It provides more flexibility in how losses arising on or after April 1, 2017 can be relieved when they are carried forward; and

·   It limits the amounts against which all carried-forward losses (whenever they arise) can be relieved to 50% of profits, subject to an annual allowance.

 

The new rules will apply to all losses arising on or after April 1, 2017. Losses arising before that date will remain subject to the existing rules and can’t benefit from the increased flexibility, but they will be subject to the restriction on the amount of profit that can be relieved by carried-forward losses.

 

In this respect the UK Government has published the following documents on January 26, 2017:

·   Draft legislation: relief for carried-forward losses

·   Explanatory note for relief for carried-forward losses - clause 1 and schedule

·   Explanatory note for relief for carried-forward losses - clause 2 (Loss relief: counteraction of avoidance arrangements)

 

Corporate interest restriction

 

This measure introduces a restriction on the amount of interest and other financing amounts that a company may deduct in computing its profits for corporation tax purposes. The legislation takes effect from April 1, 2017.

 

In this respect the UK Government has published the following documents on January 26, 2017:

·   Draft legislation: corporate interest restriction

·   Explanatory note for corporate interest restriction - clause 1 and schedule 1

 

 

Copyright – internationaltaxplaza.info

 

 

Follow International Tax Plaza on Twitter (@IntTaxPlaza)

 

and

 

Follow International Tax Plaza on Facebook

 

 

Submit to FacebookSubmit to TwitterSubmit to LinkedIn
INTERESTING ARTICLES