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The Losses memorandum template records the company's losses — brought forward, arising in the period, utilised and carried forward — by type. It is also where you determine how losses generated in the current period are used. Relief for losses brought forward from earlier periods is handled in the separate Losses carried forward relieved template.

Table of contents 

When should I use this template?

Use it to keep the memorandum of losses up to date and to decide how current-period losses are relieved — set against current-period profits, carried back, carried forward, or (for trading losses) surrendered for an R&D SME tax credit.

Before you start

Complete the income templates so the current-period results (including any losses) are known, as this template reads them.

Pre-2017 vs post-2017 losses

Losses arising before 1 April 2017 are subject to the older, more restrictive rules (they are streamed against the same type of income), whereas losses from 1 April 2017 can generally be relieved more flexibly against total profits.

Tick "The company has losses carried forward from before 1 April 2017 to be relieved" to reveal the pre-2017 section. You can then enter the pre-2017 brought-forward losses and any adjustments separately from the post-2017 losses, so each is relieved under the correct rules.

Working through the losses

The template tracks losses by type — for example trading losses, property business losses, non-trading loan relationship deficits, management expenses, miscellaneous losses and capital losses. For each type it shows the amount brought forward, arising, utilised and carried forward, with input fields for the brought-forward balances and adjustments.

For losses arising in the current period, you choose how each is relieved — set against current-period profits, carried back, carried forward, surrendered for an R&D SME tax credit, or an "other adjustment". Utilisation of losses brought forward from earlier periods is dealt with in the Losses carried forward relieved template.

What flows through to the rest of Corporation Tax?

Current-period loss relief feeds the Taxable income computation, reducing taxable total profits. The carried-forward balances feed next year's memorandum and the Losses carried forward relieved template.

What rolls forward next year?

The carried forward balance for each loss type rolls forward to become next year's brought-forward figure, keeping the memorandum current.

Where the data comes from

  • Current-period losses are taken from the income computations (trading, property, loan relationships, management expenses, miscellaneous) and the Chargeable gains calculation schedule (capital losses).
  • Group relief figures come from the Group relief template, and R&D-related surrenders from the R&D claim templates.
  • Brought-forward balances are entered here (or rolled forward), split between pre-2017 and post-2017 losses; rates come from Rates and allowances.
  • The carried-forward balances feed the Losses carried forward relieved template and next year's memorandum.

Frequently asked questions

What is the pre-2017 checkbox for?

It reveals the section for losses carried forward from before 1 April 2017, which are relieved under the older streamed rules rather than the flexible post-2017 rules.

What is the difference between this and Losses carried forward relieved?

This template records the memorandum and the utilisation of losses arising in the current period. The Losses carried forward relieved template applies relief for losses brought forward from earlier periods.

Which losses does it track?

Trading, property business, non-trading loan relationship deficits, management expenses, miscellaneous and capital losses.