(ii) Any increase or decrease in the group’s budgeted corporation tax liability for the ye

Question

(ii) Any increase or decrease in the group’s budgeted corporation tax liability for the year ending 30 June

2008 due to the restructuring on the assumption that trading losses will be used as efficiently as

possible. (8 marks)

Answer 1

正确答案：

(ii) The budgeted corporation tax liability for the year ending 30 June 2008
Following the proposed restructuring, Rapier Ltd will be carrying on four separate trades. The current year loss arising
in the Dirk trade can be offset against its total profits. Its three subsidiaries will be dormant and will not be associates
for the purpose of determining the rate of corporation tax.