Corporation Tax Act 2009 section 663

Contracts to which section 641 applies

Section 663 allows a company to carry back allowable losses on derivative contracts taxed on a chargeable gains basis and set them against chargeable gains from the same type of contracts arising in the previous 24 months.

• Where a company has net section 641 losses in a period, it can claim to carry those losses back against net section 641 gains arising in accounting periods falling wholly or partly within the preceding 24 months
• The claim must be made within two years after the end of the loss period, and it reduces both the gains in the earlier period and the losses in the later period by the amount claimed
• Losses must be set against gains in later periods before earlier ones, and where a gains period only partly falls within the 24-month window, only a proportionate fraction of the gains is available for relief
• Once losses are carried back and relieved under this section, they are used up and cannot be set off or carried forward under any other chargeable gains provisions