If your company has made a loss in the current year you will want to report that loss to HMRC as soon as possible so that it can be set against earlier profits and generate a refund of corporation tax paid for that earlier year.
To qualify for this relief the current year loss must arise from the same trade or activities as the earlier profitable activities.
If your business has made a slight change to the goods or services it provides, such as selling takeaway meals instead of restaurant service, HMRC will consider this to be a continuation of the same trade. Where your business switched to something completely different, such as from running a restaurant to buying and selling protective equipment, HMRC will consider this is to be a new trade and the current losses cannot be carried back to set against the old trade.
Generally, you can only submit a loss claim once the current accounting period has ended and the profit or loss for that period has been realised. However, HMRC will accept draft accounts for the completed current period as evidence that a loss is available to carry back to the previous period.
