Corporation Tax Act 2010 section 535B

Section 535A: use of pre-April 2019 residual business losses or deficits

Section 535B allows UK REITs to offset historic residual business losses or deficits arising before 6 April 2019 against gains that would otherwise be exempt under section 535A, so that the offset portion does not need to be included in the Property Income Distribution.

• Pre-April 2019 allowable losses on disposals and deficits from accounting periods ending before 6 April 2019 may be deducted from gains that section 535A would treat as non-chargeable, provided those losses have not already been used elsewhere
• Only losses and deficits that would otherwise have reduced profits or gains of the company's residual business qualify for this relief
• Where an accounting period straddles 6 April 2019, it is split into two notional periods at that date, with amounts apportioned on a time basis unless that would produce an unjust or unreasonable result, in which case a just and reasonable basis is used instead
• When calculating the pre-April 2019 allowable losses available under this provision, the normal corporate loss restriction rules in section 269ZBA are ignored