Corporation Tax Act 2010 section 55

Introduction to Chapter

Section 55 introduces the chapter that restricts the amount of loss relief available to companies that carry on a trade as a limited partner or as a member of a limited liability partnership (LLP).

• This chapter caps the trading loss relief available to companies that are limited partners or members of LLPs
• The restriction ensures that relief claimed does not exceed the amount the company genuinely stands to lose commercially — essentially its financial contribution to the partnership
• The relief restricted is sideways relief (setting losses against other income or profits) and group relief; carry-forward of losses against future profits of the same trade is not affected
• The chapter uses the concept of "contribution to the firm" to measure what a partner stands to lose, and persons carrying on a trade in partnership are collectively referred to as a "firm"