New rules that will allow greater flexibility in the way that companies obtain relief for losses will apply to losses incurred from 1 April 2017 onwards.

These rules have been introduced to encourage companies to diversify as the losses may be available to offset against profits of another activity in a future period and even those of a company in the same group.

The proposed new rules were consulted on the last summer and are included in the latest Finance Bill.

Although there will be greater flexibility for “new” losses arising after 1 April 2017 “old” trading losses incurred prior that that date will continue to be restricted and will only be available to of be offset against future profits from that same trade.  The new rules are very complicated and we will of course work with you to ensure that your company obtains relief for losses in the most advantageous way.


The new flexible loss relief rules coming into effect from 1 April 2017, could make the purchase of a loss-making company attractive however care and planning will be required.

For many years there has been anti-avoidance to block the use of such losses and it is proposed that these rules will continue to apply.

If within a five year period there is both a change in the nature or conduct of the trade carried on by the acquired company then the losses will be blocked.

If you would like further information, please contact your local Saint & Co Office.