A capital loss arising on the disposal of a chargeable asset (an allowable loss) may be offset against chargeable gains arising in the same accounting period. This may reduce the company’s taxable chargeable gains for that period.
If the capital losses exceed the chargeable gains in the same accounting period, the unused losses can be carried forward indefinitely. These carried-forward capital losses may be used to offset chargeable gains in future accounting periods, subject to conditions.
There is generally no time limit for carrying forward capital losses, but they must be used against the first available chargeable gains. Capital losses cannot be carried back to offset chargeable gains from previous accounting periods.
Capital losses can only be used against chargeable gains and cannot be offset against other types of income, such as trading income or rental income.
Capital losses are ring-fenced to the company that incurred them. They can only be used against chargeable gains and not other types of income.
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