CS 1962, 40 TC 358.
The taxpayer was a brewing company which had been making heavy losses. The company ceased brewing beer and commenced bottling and selling beer. The company claimed to set off the losses brought forward from prior to the change in activity against its profits from bottling and selling beer on the grounds that it was carrying on the same trade as before.
It was held that the company could not set off the profits from the brewing of beer against the trade of bottling and selling beer as the change in activity was sufficient to constitute a new trade. Under ICTA 1988, s393(1), trading losses brought forward may only be relieved against profits from the same trade.