So I have just taken on a new role and I'm reviewing some figures from the past couple of years.
It appears that perhaps some of the CT allowances and reliefs may not have been correctly claimed.
All companys referred to are owned 100% by the same director.
1) There is a group of companys ( operating under Close Company rules)
There is on profit making company called A Ltd ( UK Company)
It owns 100% of the shares in BLtd which has trading losses b/fwd
There are also 2 other Companies CLtdand DLtd which both have trading losses b/fwd.
There are then 2 other Companies which are both registered in France Call them E Ltd and F Ltd. Both of these companies turn a small profit and pay French equivalent of Corporation Tax in France.
Looking back the Profit making company has had fairly substantial trading profits and paid Corporation Tax, however none of the trading losses in the other UK companies appear to have been utilised and no marginal relief appears to have been claimed from the French Companies.
I am just about to file the current years accounts for ALtd along with the CT600.
Can I utilise the trading losses and marginal relief rules to fully utilise the losses of those other business now and relieve the CT in A Ltd and if so can I also carry back to previous tax years where they have not been claimed at all?
Altd and B Ltd are in the same trade, C,D,E and F Ltd are a completely non related trade altogether but does that matter.
I am folllowing the pricinples of "associated companies" when referring to them a s group am I correct???
Replies (9)
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You say all the companies are "owned 100% by the same director" then you say that A Ltd "owns 100% of the shares in B Ltd".
Your first statement precludes there being a group, and thus precludes A Ltd claiming relief for B Ltd's losses. Your second statement describes a group where group relief claims ought to be available.
But which statement is right? They can't both be.
Claiming marginal relief from the French companies. That's a new one on me.
You're probably as well to keep an eye on the job market, as early indications are that you don't have a Scooby.
Check old Annual Returns on Companies House re B Ltd; think it was every three years you had to confirm shareholdings so if has been around a while ought to assist understanding.
Only B Ltd can surrender its losses to A Ltd: if, and only if, it is A's 75%+ subsidiary. The other companies are out of the group, so no loss relief.
You cannot "claim" any marginal relief, as such. If A Lt'd profit fell within the bands (£300K and £1.5M divided by the number of associated companies, including A Ltd), then it might pay at the marginal rate (which is calculated by calculating tax at the full rate, and deducting marginal relief).
Has your employer not got an accountant that reviews the tax submissions, rather than leaving it in the culpable hands of their half-baked employees?
And, if you think I'm being harsh, please remember that you were the one with the apparent enthusiasm to stab your predecessor in the back.