Under s131 ITA 2007 a loss on shares in an unquoted trading company can qualify as an income loss.
What is a qualifying trading company ?
Is the company required to have been trading or is it sufficient that it was set up to trade and had incurred initial costs and professional fees etc but had not been succesful in acquiring an asset that was to be the basis of its trade ?
s137 ITA 2007 refers to the company "...exists wholly for the purpose of carrying on one or more qualifying trades"
If existed for the purposes of carrying on a trade but was not successful in obtaining a licence over an asset to enable it to actually carry on a trade is it a qualifying company ?
This is in contrast to claiming relief for irrecoverable loans to taders under s253 TCGA where the company does actually require to have traded.
Has anyone argued for this or had a problem with HMRC accepting that ok if purpose was to carry on a trade despite no income ever generated ?
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