Corporation Tax Act 2010 section 50

Cessation of trades

Section 50 defines the circumstances in which a trade is treated as having ceased and a new trade as having started, for the purposes of determining how long losses have been arising in a trade (relevant to the restriction on farming and market gardening losses under section 48).

• A trade is treated as ceasing when a company enters or leaves the charge to corporation tax for that trade, or when all original participants permanently stop carrying on the trade.
• A trade is also treated as ceasing where a partnership change results in a company dropping out of or joining the partnership.
• No cessation is triggered if the change amounts to a transfer of trade without a change of ownership under Chapter 1 of Part 22.
• Spouses, civil partners, and companies controlled by them are treated as the same person when determining whether there has been a change in the persons carrying on the trade.