We are sharing this update from ACCA, our professional body, for the interest of clients and contacts. The content is (c) ACCA
A summary of changes made to the guidance
As explained in our previous article, traders and companies incurring losses between April 2020 to March 2022 can carry back losses up to three years prior to the year in which the loss has been incurred.
For trade losses in tax years 2020/21 and 2021/22, relief is provided by allowing unrelieved losses to be carried back and set against profits of the same trade for three years before the tax year of the loss.
Companies with accounting periods ending between 1 April 2020 and 31 March 2022 can carry back up to £2m of company tax losses to three years, with losses required to be set against profits of most recent years first before carry back to earlier years.
HMRC’s guidance has been updated with information about the one-year carry back.