3 year loss carry back, how do I make it happen
Before the governments recent generosity to loss making companies you put a cross in the box to say repayment due from earlier year and you showed the loss being carried back on the comp. This resulted in a refund.
Under the 3 year carry back the order of set of is defined so you should be able to do the same. If the loss being carried back exceeds the year before's profit it should automatically be offset against the year before that provided the £50k is not being breached.
This has arisen on 2 of our clients but no refund has been forthcoming. Before I chase HMRC Have we failed to do something we should have done? Both of our clients were submitted electronically. Perhaps they have to be done manually?
It is not much help if the credit crunch finishes before the refunds turn up.
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HMRC do it manually
I'm pretty sure that HMRC have to do it manually, so chase them up.
We've had one client that it took HMRC over 4 months to deal with - they told me at the time that there was a 12 week waiting list.
Letter & amended comps
I am surprised that HMRC ever paid a refund on the strength of nothing more than a tick in the box and an entry somewhere in the tax comp for losses carried back.
It has always been our practice to write a letter (assuming that the CT600 is being submitted online - otherwise, a covering letter with the CT600) to the CT district to claim relief formally under s.393A ICTA 1988 and to ask for the repayment to be made to the client (just in case HMRC might think to leave it sitting on the account). If the losses are being carried back to the previous year, we also submit an amended CT600 online for that previous year. If it is one or both of the earlier years, which would be out of time for amendment, we would submit revised tax comps with the letter.
Given the HMRC's general reluctance to part with any refunds, you have got to spell it out to them.
Incidentally, the 3 year carry back was included in the Finance Act 2009 which only passed into law in July 2009 (I think), so HMRC would not have processed any claims before then.
Incorrect
Repayments were being made by HMRC from 22 April 2009.