Finance Act 2020 (c. 14)

SCHEDULES

SCHEDULE 4 U.K. Corporate capital losses

PART 1 U.K. Corporate capital loss restriction

Minor and consequential amendments to Part 7ZA of CTA 2010 U.K.

24 U.K. Part 7ZA of CTA 2010 is amended as follows.

25 (1) Section 269ZB (restriction on deductions from trading profits) is amended in accordance with this paragraph. U.K.

(2) In subsection (8), for paragraph (b) substitute—

“(b) the total of—

(i) the amount of the company's total non-trading profits deductions allowance for the period (see section 269ZC(3A)), and

(ii) in the case of an insurance company, any amount specified for the period under section 269ZFC(5)(a) (BLAGAB deductions allowance).”

(3) Omit subsection (9) (meaning of a company's “deductions allowance”).

26 U.K. In section 269ZC (restriction on deductions from non-trading profits) omit subsection (7) (meaning of a company's “deductions allowance”).

27 U.K. In section 269ZD (restriction on deductions from total profits) omit subsection (6) (meaning of a company's “deductions allowance”).

28 U.K. After section 269ZD insert—

“269ZDA References to a company's “deductions allowance”

(1) This section applies for the purposes of sections 269ZB to 269ZD and 269ZFC.

(2) A company's “deductions allowance” for an accounting period is to be determined in accordance with section 269ZR where, at any time in that period—

(a) the company is a member of a group (see section 269ZZB), and

(b) one or more other companies within the charge to corporation tax are members of that group.

(3) Otherwise, a company's “deductions allowance” for an accounting period is to be determined in accordance with section 269ZW.

(4) But subsections (2) and (3) are subject to section 269ZYA (deductions allowance for company without a source of chargeable income).”

29 (1) Section 269ZF (“relevant trading profits” and “relevant non-trading profits”) is amended in accordance with this paragraph. U.K.

(2) In subsection (2)—

(a) for “ “relevant non-trading profits””, in both places it occurs, substitute “ “relevant non-trading income profits” ”,

(b) in paragraph (a), for “qualifying non-trading profits” substitute “ qualifying non-trading income profits ”, and

(c) in paragraph (b) for “non-trading profits deductions allowance” substitute “ non-trading income profits deductions allowance ”.

(3) In subsection (3), in the words before step 1, for “and qualifying non-trading profits” substitute “ , qualifying non-trading income profits and qualifying chargeable gains ”.

(4) In subsection (3), in paragraph (3) of step 1—

(a) for “and relevant non-trading profits” substitute “ , qualifying non-trading income profits and qualifying chargeable gains ”, and

(b) for “both” substitute “ each ”.

(5) In subsection (3), in paragraph (3) of step 2—

(a) for “and the qualifying non-trading profits” substitute “ , qualifying non-trading income profits and qualifying chargeable gains ”, and

(b) for “both” substitute “ each ”.

(6) In the heading, for “and “relevant non-trading profits”” substitute “ , “total relevant non-trading profits” etc ”.

30 (1) Section 269ZFA (“relevant profits”) is amended as follows. U.K.

(2) In subsection (1)(b), for “section 269ZD(6)” substitute “ section 269ZDA ”.

(3) In subsection (2)—

(a) in paragraph (a), for “qualifying trading profits and qualifying non-trading profits” substitute “ modified total profits ”, and

(b) in paragraph (b), for “in determining” substitute “ which could be relieved against ”.

31 U.K. In section 269ZG (general insurance companies: excluded accounting periods), in subsection (1), for “269ZE” substitute “ 269ZD ”.

32 U.K. In section 269ZR (deductions allowance for company in a group), at the end insert—

“(5) See section 269ZYA for further provision about the deductions allowance for a company without a source of chargeable income which is a member of a group.”

33 U.K. In section 269ZW (deductions allowance for company not in a group), at the end insert—

“(4) See section 269ZYA for further provision about the deductions allowance for a company without a source of chargeable income.”

34 U.K. In section 269ZZ (company tax return to specify amount of deductions allowance), in subsection (2)—

(a) after “section 269ZB(2),” insert “ 269ZBA(2), ”, and

(b) for “or 269ZD(2) or section 124D(1) of FA 2012” substitute “ , 269ZD(2) or 269ZFC(2) ”.

35 (1) Section 269ZZA(1) (excessive specification of deductions allowance: application of section) is amended in accordance with this paragraph. U.K.

(2) After paragraph (b) insert—

“(ba) the company's chargeable gains deductions allowance for the period,”.

(3) In paragraph (c) for “non-trading profits deductions allowance” substitute “ non-trading income profits deductions allowance ”.

(4) After paragraph (d) insert—

“(da) the company's BLAGAB deductions allowance for the period.”

(5) Omit paragraph (e).