Corporation Tax Act 2010 section 52

Dealings in commodity futures

Section 52 is an anti-avoidance provision that denies trade loss relief where a company makes a loss dealing in commodity futures through a partnership and the arrangements are designed primarily to obtain a tax advantage.

• Where a company carries on a trade of dealing in commodity futures as a partner in a partnership and makes a loss, this section may deny relief for that loss
• The denial applies where a scheme or arrangements have been put in place (whether through the partnership agreement or otherwise) under which the sole or main benefit the company expects from its partnership interest is a reduction in its tax liability through sideways loss relief against total profits
• If loss relief has already been given in circumstances caught by this section, HMRC will withdraw that relief by raising a corporation tax assessment
• Commodity futures for these purposes means futures currently dealt in on a recognised futures exchange, which includes the London International Financial Futures Exchange and any other futures exchange designated by HMRC