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Income Tax (Earnings and Pensions) Act 2003

Section 420: Negative amounts treated as nil

1828.The charges to income tax for which this Part of this Act provides constitute “specific employment income” (see sections 6(1) and 7(4) of this Act). Under ICTA this income is charged to income tax under paragraph 5 of section 19(1) of that Act.

1829.In this Part of this Act, where deductions from a chargeable amount are permitted, the relevant provision signals this fact by using a formula.

1830.This section, which is new, gives effect to the general proposition that it is not possible for an allowable loss to arise under paragraph 5 of section 19(1) of ICTA. Deductions might reduce a chargeable amount to nil; but, beyond this point, they could not be used to create a negative amount and (accordingly) an allowable loss. See Note 43 in Annex 2.

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