Case on Losses
A slightly unusual case recently concerned Leekes Ltd, a company that carried on a trade of running out of town department stores. Some years ago it purchased another company that carried on a trade of retail furniture sales and warehousing, and had incurred substantial losses. The business of the acquired company was transferred up and all of the stores were rebranded and then continued to trade. The company claimed relief for historic losses against the total profits. HMRC refused the claim on the grounds that, in its opinion, the losses could be used only against the profits of the acquired trade. The First Tier Tribunal found for the company and said that all of the losses could be used against the new combined trade.
Based on this case it may be worth looking at any acquisitions made with losses as there may be scope for wider offset than originally thought
Date: 29th April, 2015
Articles from this Author
1st November, 2018
Budget 2018 - Changes for businesses
22nd October, 2018
Making the most out of your home? Rent a room relief
3rd May, 2018
Tax changes for non-resident corporate landlords
4th April, 2018
EMI options - a current risk
Contact Business Service Partners
Choose from the drop down menu below to select a Partner to contact.
For the latest Mercer & Hole news, visit our LinkedIn page mercer-&-hole