OT16520 - PRT: allowable losses - unrelievable field losses: licence transfers - anti-avoidance - examples
Example 1
| Ìý | CP | Profit\(Loss) | Oil Allowance | PRT |
|---|---|---|---|---|
| Company X | CP1 | (20) | 0 | Ìý |
| Ìý | CP2 | 30 | 10 | 0 |
| Ìý | CP3 | 40 | 40 | 0 |
| Ìý | CP4 | 10 | 10 | 0 |
| Company Y | CP5 | 10 | 10 | 0 |
| Ìý | CP6 | (80) | 0 | Ìý |
The transfer from X to Y is completed after 7 March 2001 and is subject to a successful FA80\SCH17\PARA4 disapplication. Under the old rules Y바카라 사이트™s UFL would have been 70. Its CP6 loss would only have been reduced by 10 under OTA75\S7(3). But under FA01\SCH32, its UFL is reduced to 10 after taking account of X바카라 사이트™s relevant profits of 60.
Example 2
The facts are the same as in Example 1 except that in CP3 X바카라 사이트™s profits of 40 are calculated after the allowance of a claim under OTA75\S5B (research) of 5. The 5 is 바카라 사이트˜unrelated field expenditure바카라 사이트™ and needs to be 바카라 사이트˜added back바카라 사이트™ to arrive at X바카라 사이트™s relevant profits. X바카라 사이트™s relevant profits therefore become 65 and Y바카라 사이트™s UFL is accordingly reduced to 5 (70-65).
Example 3
The facts are the same as in Example 1 except that X transfers only 50% of its interest to Y with the balance being transferred to another company, Z. In calculating Y바카라 사이트™s UFL, FA01\SCH32\PARA8(3) means that only 50% of X바카라 사이트™s relevant profits (바카라 사이트˜the corresponding part바카라 사이트™) need to be taken into account. The UFL is therefore 40 (70-30).
Example 4
| Ìý | CP | Profit\(Loss) | Oil Allowance | PRT |
|---|---|---|---|---|
| Company X | CP1 | (50) | 0 | Ìý |
| Company Y | CP2 | 10 | 10 | 0 |
| Ìý | CP3 | 20 | 20 | 0 |
| Ìý | CP4 | 10 | 10 | 0 |
| Ìý | CP5 | 10 | 10 | 0 |
| Company Z | CP6 | (50) | 0 | Ìý |
Both transfers are completed after 7 March 2001 and are subject to successful disapplications under FA80\Sch17\ParaA4. Under the old rules, both X and Z would have been able to claim UFLs of 50. But the UFL that would have arisen had there been no transfers of the interest would have been 50 (combined losses of 100 less relevant profits of 50). Under FA01\Sch32\Para10(1) Z바카라 사이트™s UFL remains 50, but X바카라 사이트™s UFL is reduced to 0. X바카라 사이트™s loss is offset in priority to Z바카라 사이트™s as it accrued at an earlier time.
Example 5
| Ìý | CP | Profit\(Loss) | Oil Allowance | PRT |
|---|---|---|---|---|
| Company X | CPs1-8 | 30 | 30 | 0 |
| Company Y | CP9 | 10 | 0 | 0 |
| Company Z | CP10 | (50) | 0 | Ìý |
Both transfers are completed after 7 March 2001.The XY transfer is subject to a successful FA80\Sch17\Para4 disapplication, but the YZ transfer is within FA80\Sch17 Parts II and III.
Under the old rules, Z바카라 사이트™s UFL would have been 40 after taking into account the necessary carry back of 10 under FA80\Sch17\Para15 to cover Y바카라 사이트™s assessable profits. But, although Z itself has not been party to an excluded transfer, its loss is still within FA01\Sch32. There is an 바카라 사이트˜excluded transfer바카라 사이트™ between X and Y (FA01\Sch32\Para1(1)(b)) and Z is a 바카라 사이트˜subsequent new owner바카라 사이트™ (FA01\Sch32\Para1(1)(c)). Z바카라 사이트™s UFL is therefore reduced to 10 (50-10-30), the UFL which would have been claimable had there been no field transfers.