Section 37 | Relief for trade losses against total profits

(1)This section applies if, in an accounting period, a company carrying on a trade makes a loss in the trade.

(2)The company may make a claim for relief for the loss under this section (but see subsection (5)).

(3)If the company makes a claim, the relief is given by deducting the loss from the company's total profits of—

(a)the accounting period in which the loss is made (“the loss-making period”), and

(b)if the claim so requires, previous accounting periods so far as they fall (wholly or partly) within the period of 12 months ending immediately before the loss-making period begins.

(4)The amount of a deduction to be made under subsection (3) for any accounting period is the amount of the loss so far as it cannot be deducted under that subsection for a subsequent accounting period.

(5)The company may not make a claim if, in the loss-making period, the company carries on the trade wholly outside the United Kingdom.

(6)A deduction under subsection (3)(b) may be made for an accounting period only if the company—

(a)carried on the trade in the period, and

(b)did not do so wholly outside the United Kingdom.

(7)The company's claim must be made—

(a)within the period of two years after the end of the loss-making period, or

(b)within such further period as an officer of Revenue and Customs may allow.

(8)If, for an accounting period, deductions under subsection (3) are to be made for losses of different accounting periods, the deductions are to be made in the order in which the losses were made (starting with the earliest loss).

(9)Relief under this section is subject to restriction or modification in accordance with provisions of the Corporation Tax Acts.