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Carry group relief back to previous year?

jiltjilt Font Of All KnowledgeRegistered Posts: 2,903
I have two associated companies. After R & D enhancement company A has losses of £122873 and company B has profits of £91382. Can company A surrender £91382 of it's losses to company B to wipe out the profits in the current year and then carry back the £31491 to company B's previous year to reduce it's profits?

It would be more of a tax saving to do this rather than company A claim tax credits on the £31491 in the current year however I am not sure if it's allowed and don't seem to be able to find the answer in any guidance.

Any help would be much appreciated.

Comments

  • MonsoonMonsoon Font Of All Knowledge FMAAT, AAT Licensed Accountant Posts: 4,071
    You're braver than me. I don't touch groups with a bargepole!

    Have you checked CCH Online, or gone back to the relevant tax statute?
  • jiltjilt Font Of All Knowledge Registered Posts: 2,903
    I don't touch groups either normally. It's my subcontract work that I've mentioned to you before with a local accountant where I prepare the amended tax comps and tax returns for R & D claims. I've had a few where they have been groups and there's been a surrender of losses that was straight forward but this one had greater losses then the group company's amended profits.

    It's sorted now though thanks, I posted on accounting web as well and got the answer I needed which was basically no I can't carry it back to the previous year of a group company. I can surrender it in the current year, and can either utilise the balance for R & D tax credits or carry it forward to next year.

    I checked my ATT book and trawled through HMRC guidance but couldn't find what I was looking for. I haven't used CCH, any idea of the cost, is it an annual subscription or a PAYG type of thing?
  • MonsoonMonsoon Font Of All Knowledge FMAAT, AAT Licensed Accountant Posts: 4,071
    Jill, CCH Online is provided as part of your MIP subs!!!!!!! ;)

    And glad you got the answer. For what it's worth, that was my gut feeling but I wasn't going to guess!!
  • jiltjilt Font Of All Knowledge Registered Posts: 2,903
    Monsoon wrote: »
    Jill, CCH Online is provided as part of your MIP subs!!!!!!! ;)

    And glad you got the answer. For what it's worth, that was my gut feeling but I wasn't going to guess!!



    I had prepared the tax comps etc as though I couldn't carry it back but the guy I do them for had questioned it so I had to double check. He's an ACCA accountant but by his own admission knows nothing about tax and just scraped through his tax exams! Right pair aren't we.

    I did actually wonder what I was paying subs for! ..lol I really must log on and see what's available, I very rarely go on there :blushing: Will attempt to have a look while dinners cooking tonight, we're leaving early to enjoy a nice bottle of wine whilst admiring Steve's pumpkin carving skills. Check em out on FB I'll like his post so you can see it.

    Have a great Samhain Jenni x
  • MonsoonMonsoon Font Of All Knowledge FMAAT, AAT Licensed Accountant Posts: 4,071
    You get loads with your subs!!
    ICAEW technical (accounting) advice line too.
    I only discovered that and CCH about a year ago - felt like a right dummy!
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