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S1216DC Corporation Tax Act 2009 (CTA 2009)

»Ê¹ÚÌåÓýapp rules in Part 15A CTA 2009 modify the normal rules for relieving corporate trading losses. »Ê¹ÚÌåÓýapp losses incurred by a television programme trade of a Television Production Company (TPC) can only be surrendered for payable tax credit, where applicable, or used against future profits of the same trade prior to completion of the programme.

When a separate programme trade ceases, a TPC may pass losses on to another trade that qualifies for Television Tax Relief (TTR). »Ê¹ÚÌåÓýapp trade must be carried on at the time of cessation and can be:

• another trade carried on by the same company, or
• another trade carried on by a different TPC in the same group.

A company is in the same group for these purposes if it is in the same group for group relief purposes. See CTM80150.

»Ê¹ÚÌåÓýapp trade that the losses are transferred to does not need to be a programme trade of the same type. It must still qualify for TTR and so, if it is not a drama or documentary trade, it may be an animation.

»Ê¹ÚÌåÓýapp losses are treated as losses brought forward to be set against profits of the TTR-qualifying trade for the accounting period that commences after the cessation.

For example, company A claims terminal loss relief under the rules in Part 15A CTA 2009. It ceases on 31 October 2014. It surrenders losses to company B which is in the same group and has a TTR trade. Company B has a chargeable accounting period ended 30 April 2015. »Ê¹ÚÌåÓýapp losses transferred will be treated as brought forward by company B in the period commencing 1 May 2015.

This is in contrast to the normal rules on terminal losses which must be offset against profits of the same trade arising in the three previous years.

»Ê¹ÚÌåÓýapp new loss provisions from 1 April 2017 will still allow companies to utilise  terminal losses in a similar manner whether they are brought forward under s45 or S45A of CTA 2010