The proportion of a banking company's annual taxable profit that can be offset by pre-2015 carried-forward losses (ie losses carried forward from before 1 April 2015) is restricted1. The restriction is set at 25%; only 25% of the banking company's profits can be offset by the carried forward losses. For what constitutes a banking company for these purposes see 'Definition of banking company' at D7.701A.
This restriction is in addition to the general loss relief restriction – where only 50% of profits in excess of (broadly) £5m can be offset by brought forward losses (see D1.1108B)2. Post-2015 losses are only subject to the general loss-relief restriction (see D1.11).
The restriction applies to trading losses (CTA 2010, s 45), non-trading loan relationship deficits (CTA 2009, s 457) and management expenses carried forward (CTA 2009, ss 63, 1223) from accounting periods ending before 1 April 2015 (a 'pre-2015 loss')3. Accounting periods which begin before 1 April 2015 and end after 1 April 2015 (straddling periods) are treated as separate accounting periods and profits
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