So I'm seeing this question pop up quite frequently where they ask what would influence a company's choice of relief claim. It says that the tax rate at which relief would be obtained is a factor and then it says: 26.5% if marginal relief applies (best use). I don't understand the 26.5% figure since we use the main rate of 25% even when marginal relief applies.
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Choice of relief claims
Please do not get confused with this effective rate.
I dont teach it.
I dont like it
Yes it's a fact but it confuses students.
For CT purposes remember this:
Loss relief -
1. get any company out of the margin and down to the lower limit. Then if there's any loss left
2. give losses to companies paying tax at the full rate
Simple!
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