Draft Finance Bill measures will prolong the misery of financial crisis for banks. The rules restrict the proportion of banks’ annual taxable profit that can be offset by carried forward losses to 50%. The restriction will apply to carried forward trading losses, non-trading loan relationship deficits and management expenses, with effect from 1 April 2015. It will only apply to reliefs accruing prior to this date. A targeted anti-avoidance rule (TAAR) applies to arrangements entered into from 3 December 2014. However, the TAAR as currently drafted has a real risk of misfiring, and should be an area for active consultation in the Finance Bill process.
