Corporation Tax Act 2010 section 680

Restriction on the carry forward of non-trading deficit from loan relationships

Section 680 restricts the ability of a company that has undergone a change in ownership to carry forward non-trading deficits arising from its loan relationships into post-ownership-change accounting periods.

• Where a company with an investment business undergoes a change in ownership, any non-trading deficit from loan relationships attributed to the pre-change period may be blocked from carry forward.
• The restriction applies when the non-trading deficit is apportioned to the first notional accounting period (the period before the ownership change) under the rules in section 685.
• If the restriction applies, none of the non-trading deficit may be carried forward to the accounting period beginning immediately after the change in ownership, or to any later accounting period.
• Non-trading debits and non-trading deficits serve different purposes within the loan relationships regime, so this chapter imposes separate and distinct restrictions on each.