Under blagaab, if min profit is negative we will only pay policyholder tax rate and carry forward 50% of loss or upto 50% of next year profit? Example at t=1 Min profit is -50 I-e is 90 And say at t=2 Min profit is 90 I-e is 60 So in t1 we pay p/h tax on 90 and carry forward rest mp. In year 2 we offset min profit with 25 (50% of -50) or 45 (upto 50% of 90)? Further min profit test to assess how much is payable at ph tax rate, year 2 will be based on after offset amount of min profit ? Thirdly what is the relevance of 5mn? And situations where it might be used 5mn + 50%? Can you provide an example?
I think the rule is that if profits are less than £5m then the offsetting losses can be used unrestricted. Anything over this the offset is capped to 50% of the profits. So the second in your question. See paragraph 31 of this for why i think that https://assets.publishing.service.g...tax_relief_for_carried-forward_losses_EN_.pdf Yes min profit test is done after offsetting losses. If profit is less than £5m in year 2 then it can be fully offset if there are >=£5m losses in the previous year. So that profit is 0.
