Corporation Tax Act 2010 section 676AB

Priority of provisions of Chapters 2 and 3 over this Chapter

Section 676AB establishes that where both the older anti-avoidance rules in Chapters 2 and 3 of Part 14 and the newer Chapter 2A rules could apply to restrict the same loss or amount following a change in company ownership, the older rules take priority.

• Where both Chapter 2A and Chapter 2 or 3 provisions could apply to the same loss or amount, the Chapter 2A provision does not apply
• The Chapter 2A provisions affected are the restriction rules in sections 676AF to 676AK, which deal with carried-forward post-1 April 2017 losses
• The Chapter 2 and 3 provisions that take priority are sections 674 and 679 to 683, which disallow trading losses and restrict relief where there is a major change in the nature or conduct of a trade or business
• The practical effect is that losses caught by the older rules are disallowed completely rather than merely restricted under the newer Chapter 2A provisions