»Ê¹ÚÌåÓýapp

»Ê¹ÚÌåÓýapp trade in relation to the film commences on 3 July 2009 and the film is completed on 10 February 2010. »Ê¹ÚÌåÓýapp company draws up accounts to 31 December. »Ê¹ÚÌåÓýapp accounting periods are therefore:

• 3 July to 31 December 2009
• Year ended 31 December 2010
• Year ended 31 December 2011

»Ê¹ÚÌåÓýapp computations show:

APE 31 December 2009	Amount
Income from the film	100,000
Costs of the film	(850,000)
Film tax relief - additional deduction	(400,000)
Loss on film	(1,150,000)
Other income	10,000

»Ê¹ÚÌåÓýapp computation for this period shows a trade loss of 1,150,000. »Ê¹ÚÌåÓýapp company chooses not to surrender any part of this trading loss for the film tax credit. This is a production accounting period and so loss relief is restricted. »Ê¹ÚÌåÓýapp loss can only be carried forward under CTA10/S45B. »Ê¹ÚÌåÓýapp other income profit therefore remains taxable and a loss of 1,150,000 is carried forward under CTA10/S45B. Of these losses, 400,000 is attributable to FTR; 750,000 is not.

APE 31 December 2010 - completion period	Amount
Income from the film	100,000
Costs of the film	(150,000)
Film tax relief - additional deduction	(100,000)
Loss on film	(150,000)
Other income	20,000

This is the completion period. »Ê¹ÚÌåÓýapp computation shows a trade loss of 150,000. »Ê¹ÚÌåÓýapp company chooses not to surrender any part of this trading loss for the film tax credit.

»Ê¹ÚÌåÓýapp loss brought forward from the accounting period ended 31 December 2009 may also be treated as a loss of this accounting period for the purposes of loss relief in so far as it is not attributable to FTR. »Ê¹ÚÌåÓýapp amount carried forward into the completion period that is not attributable to Film Tax Relief is 750,000.

»Ê¹ÚÌåÓýapp loss of the completion period that is available to surrender, set sideways and carry back is restricted; it is calculated as if no FTR was ever available. »Ê¹ÚÌåÓýapp adjusted loss is 50,000.

»Ê¹ÚÌåÓýapp total amount of loss available for loss relief purposes in this accounting period is therefore 800,000. This is made up of the 750,000 brought forward and the 50,000 of the period itself. This loss is available:

• to set against other profits of the same accounting period;
• to carry back under CTA10/S37 against profits of an earlier accounting period; and
• to surrender as group relief where appropriate.

»Ê¹ÚÌåÓýapp company chooses to set off 20,000 of the loss against the other income of the completion period and carry back 10,000 against the other income in the earlier production period. Leaving 770,000 to carry forward.

Any remaining loss, whether attributable to Film Tax Relief or not is carried forward under CTA10/S45A and B. A total of 1,270,000 remains available to be carried forward under CTA10/S45A and B.

APE 31 December 2011	Amount
Income from the film	1,000,000
Costs of the film - exploitation costs	(100,000)
Profit on film	900,000
Other income	50,000

»Ê¹ÚÌåÓýapp computation for this period shows a trade profit of £900,000. »Ê¹ÚÌåÓýapp brought forward loss of 1,270,000 is set against this profit. »Ê¹ÚÌåÓýapp loss attributable to FTR is used in priority, followed by the loss not attributable to FTR that derives from the completion period. This leaves a loss of 370,000 which can be identified as not attributable to Film Tax Relief and derived from the production period. This loss can be treated as a loss of this accounting period for the purposes of loss relief.

»Ê¹ÚÌåÓýapp following table tracks the use of the losses in the accounting periods:

-	FTR	non-FTR	FTR	non-FTR
APE 31 December 2009	-	-	-	-
Production period loss	400,000	750,000	-	-
Losses carried forward into completion AP	400,000	750,000	-	-
APE 31 December 2010	-	-	-	-
Losses brought forward	400,000	750,000	-	-
Completion period loss	-	-	100,000	50,000
Loss utilised against other income (CY & PY)	0	0	0	(30,000)
Losses carried forward	400,000	750,000	100,000	20,000
APE 31 December 2011	-	-	-	-
Losses brought forward	400,000	750,000	100,000	20,000
Utilised against profit of same trade	-400,000	-380,000	-100,000	-20,000
Remaining - available to set off or surrender	0	370,000	0	0