OT21076 - Corporation Tax Ring Fence and Supplementary Charge

Repayment of PRT and carry back of Losses

Where repayment of PRT is attributable to the carry back of losses of PRT chargeable periods ending after 30 June 1991 ICTA88/s500(5)-(9) treats the repayment as ring fence trading income of the AP in or at the end of which the PRT chargeable period in which the loss arises ends. If the ring fence trade ceases before the end of that AP, the repayment is treated as trading income of the final trading AP.

ICTA88/s500(7) provides for the situation where the PRT repayment arises from more than one loss and the losses accrue in different chargeable periods. By virtue of ICTA88/s500(8) the repayment is apportioned on the assumption that relief is given for the loss of an earlier period before that of a later period.