Commentary on Sections Overview Chapter 4: Film losses Section 1210: Use of losses in later periods
3057.This section modifies, for accounting periods from that in which the film is completed or abandoned (“the completion period”), the rules on trade losses and their offset against other profits. It is based on section 44(1) to (4) and (6) of FA 2006.
3058.Subsection (1)(b) refers to the separate film trade continuing in accounting periods after the completion period. This deals with the possibility that a film production company might decide to exploit the completed film, rather than sell it. In such a case the separate film trade may continue after the completion period.
3059.Subsections (2) and (3) allow part (or all) of single film trade losses brought forward to the completion period to be treated as if they were single film trade losses of the completion period. Single film trade losses of the completion period are not subject to the restrictions in section 1209. Any brought forward losses that are attributable to film tax relief (see subsection (6)) will not be “freed-up” in this manner. Nor will losses be “freed-up” if they are brought forward because of section 1211 (terminal losses) (see subsection (7)).
3060.Subsections (4) and (5) prevent single film trade losses being offset against other profits to the extent that such losses are attributable to film tax relief (see subsection (6)).