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Question re UK Tax. I started two companies last year and I

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Question re UK Tax.
I started two companies last year and I am about to file the first tax return of each company. Both companies are owned 100% by myself and both made small losses in the first year of trading.
I am a Director with my wife of a third company (we each own 50% of the shares) that has been trading for 8 years and is going to make a profit this year. Can this company acquire the shares of the two other companies and use the losses made by the two companies to offset against the profit, thereby reducing the Corporation tax of the profitable company? If it is possible what forms are required for HMRC and what must I do for Companies House?
Submitted: 10 months ago.
Category: Tax
Expert:  bigduckontax replied 10 months ago.

Hello, I am Keith, one of the experts on Just Answer, and pleased to be able to help you with your question.

One company can acquire the other then you will have a company group. Once the companies are grouped then tax losses can be carried up down and sideways to relieve other liabilities within the group. No special forms are required for HMRC or for Companies House although the latter organisation will have to be informed when the next Annual Return is made.

There is an alternative merely for the company with a profit to be billed by the company with a loss for services which will adjust the profitability of each company.

I do hope that you have found my reply of assistance.

bigduckontax, Accountant
Category: Tax
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Experience: FCCA FCMA CGMA ACIS
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Expert:  bigduckontax replied 10 months ago.

Thank you for your support.

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