Corporation Tax Act 2010 section 269ZDA

References to a company's "deductions allowance"

Section 269ZDA explains how to determine which set of rules applies when calculating a company's "deductions allowance" — the amount of relevant carried-forward losses and other deductions a company may set against its profits in an accounting period before the corporate loss restriction takes effect.

• The deductions allowance limits the amount of certain carried-forward deductions a company can use in a given accounting period before the restriction on deductions applies.
• Where a company is part of a group containing at least one other company within the charge to corporation tax, the deductions allowance is determined under the group rules, which require the group to allocate a single shared allowance among its members.
• Where a company is not part of such a group — for example, it is a standalone entity — it determines its own deductions allowance independently under separate standalone company rules.
• Both the group and standalone rules are overridden by a special provision that applies where a company has no source of chargeable income, in which case a separate deductions allowance calculation applies.