Corporation Tax Act 2010 section 68

Share loss relief

Section 68 introduces share loss relief, which allows a company to set an allowable capital loss on certain shares against its total profits, rather than only against chargeable gains.

• A company that originally subscribed for shares in a qualifying trading company may claim share loss relief if it incurs an allowable capital loss on disposing of those shares and meets the eligibility conditions in section 69.
• The disposal must be at arm's length, as part of a winding up of the investee company, on the total loss or destruction of the shares, or under a negligible value claim.
• Share loss relief is not available where the shares are disposed of as part of a company reconstruction or share-for-share exchange under sections 135, 136 and 137 of the Taxation of Chargeable Gains Act 1992.
• The term "qualifying trading company" is defined separately in section 78 of this Act.