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Special losses
Key points
- The temporary extension to the trading loss carry back rules apply only to trading losses.
- The extension is only available for losses arising in accounting periods ending between 1 April 2020 and 31 March 2022 inclusive.
- As the rules for companies are an extension of the normal 12 month carry back rule a current year claim must be made first.
- For the special extended relief the loss that can be carried back to the earlier two years of the three year carry back period is capped at £2m for ‘2020 claims’ and a further £2m cap for ‘2021 claims’.
Following the pandemic and the struggles this has caused for many companies the government has introduced a ‘special’ temporary extension to the trading loss carry back rules for companies. These are examinable in both Association of Taxation Technicians papers 2 and 4.
To be clear these rules apply only...
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