Textual Amendments
F1Words in s. 272 cross-heading inserted (16.11.2017) (with effect in accordance with Sch. 2 para. 64 of the amending Act) by Finance (No. 2) Act 2017 (c. 32), Sch. 2 para. 14
(1)The profits of a property business are calculated in the same way as the profits of a trade.
(2)But this is subject to—
(a)section 272, which limits the rule in subsection (1) in relation to a property business whose profits are calculated in accordance with GAAP, and
(b)section 272ZA, which limits that rule in relation to a property business whose profits are calculated on the cash basis.]
Textual Amendments
F2S. 271E inserted (16.11.2017) (with effect in accordance with Sch. 2 para. 64 of the amending Act) by Finance (No. 2) Act 2017 (c. 32), Sch. 2 para. 15
F4(1). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(2)[F5In relation to a property business whose profits are calculated in accordance with GAAP, the provisions of Part 2 (trading income) which apply as a result of section 271E(1) are limited to the following—]
| In Chapter 3 (basic rules)— | |
| F6. . . | F6. . . |
| section 26 | losses calculated on same basis as profits |
| section 27 | receipts and expenses |
| section 28 | items treated under CAA 2001 as receipts and expenses |
| [F7section 28A | money's worth] |
| section 29 | interest |
| In Chapter 4 (rules restricting deductions)— | |
| section 33 | capital expenditure |
| section 34 | expenses not wholly and exclusively for trade and unconnected losses |
| section 35 | bad and doubtful debts |
| sections 36 and 37 | unpaid remuneration |
| sections 38 to 44 | employee benefit contributions |
| sections 45 to 47 | business entertainment and gifts |
| sections 48 to [F850B] | car F9... hire |
| F10. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . | F10. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . |
| section 52 | exclusion of double relief for interest |
| section 53 | social security contributions |
| section 54 | penalties, interest and VAT surcharges |
| section 55 | crime-related payments |
| [F11section 55A | expenditure on integral features] |
| In Chapter 5 (rules allowing deductions)— | |
| section 57 | pre-trading expenses |
| sections 58 and 59 | incidental costs of obtaining finance |
| F12. . . | F12. . . |
| section 69 | payments for restrictive undertakings |
| sections 70 and 71 | seconded employees |
| section 72 | payroll deduction schemes: contributions to agents' expenses |
| sections 73 to 75 | counselling and retraining expenses |
| sections 76 to 80 | redundancy payments etc. |
| section 81 | personal security expenses |
| sections 82 to 86 | contributions to local enterprise organisations or urban regeneration companies |
| [F13sections 86A and 86B | contributions to flood and coastal erosion risk management projects] |
| sections 87 and 88 | scientific research |
| sections 89 and 90 | expenses connected with patents, designs and trade marks |
| section 91 | payments to Export Credits Guarantee Department |
| [F14section 94A | costs of setting up SAYE option scheme or CSOP scheme] |
| [F15section 94AA | deductions in relation to salaried members of limited liability partnerships] |
| [F16In Chapter 5A (deductions allowable at a fixed rate) | |
| section 94C | exclusion of provisions of Chapter 5A for firms with partner who is not an individual |
| sections 94D to 94G | expenditure on vehicles] |
| In Chapter 6 (receipts)— | |
| section 96 | capital receipts |
| section 97 | debts incurred and later released |
| section 104 | distribution of assets of mutual concerns |
| section 105 | industrial development grants |
| section 106 | sums recovered under insurance policies etc. |
| In Chapter 7 (gifts to charities etc.)— | |
| section 109 | receipt by donor or connected person of benefit attributable to certain gifts |
| [F17In Chapter 10A (long funding leases)— | |
| Sections 148A to 148J | Leases of plant or machinery: special rules for long funding leases] |
| In Chapter 11 (other specific trades)— | |
| section 155 | levies and repayments under FISMA 2000 |
| In Chapter 13 (deductions from profits)— | |
| sections 188 to 191 | unremittable amounts |
(3)In those provisions the expression “this Part” is to be read as a reference to those provisions as applied by subsection (2) and to the other provisions of Part 3.
Textual Amendments
F3S. 272 heading substituted (16.11.2017) (with effect in accordance with Sch. 2 para. 64 of the amending Act) by Finance (No. 2) Act 2017 (c. 32), Sch. 2 para. 16(2)
F4S. 272(1) omitted (16.11.2017) (with effect in accordance with Sch. 2 para. 64 of the amending Act) by virtue of Finance (No. 2) Act 2017 (c. 32), Sch. 2 para. 16(3)
F5Words in s. 272(2) substituted (16.11.2017) (with effect in accordance with Sch. 2 para. 64 of the amending Act) by Finance (No. 2) Act 2017 (c. 32), Sch. 2 para. 16(4)
F6S. 272(2) entry omitted (16.11.2017) (with effect in accordance with Sch. 2 para. 64 of the amending Act) by virtue of Finance (No. 2) Act 2017 (c. 32), Sch. 2 para. 16(5)
F7Words in s. 272(2) Table inserted (with effect in accordance with s. 71(7) of the amending Act) by Finance Act 2016 (c. 24), s. 71(3)
F8Word in s. 272(2) Table substituted (with effect in accordance with Sch. 11 paras. 65-67 of the amending Act) by Finance Act 2009 (c. 10), Sch. 11 para. 41(a)
F9Words in s. 272(2) Table omitted (with effect in accordance with Sch. 11 paras. 65-67 of the amending Act) by virtue of Finance Act 2009 (c. 10), Sch. 11 para. 41(b)
F10S. 272(2) Table: entry repealed (6.4.2007 with effect as stated in s. 1034(1) of the amending Act) by Income Tax Act 2007 (c. 3), ss, 1027, 1031, 1034, Sch. 1 para. 507, {Sch. 3 Pt. 1} (with transitional provisions and savings in Sch. 2)
F11Words in s. 272(2) Table inserted (with effect in accordance with s. 73(6) of the amending Act) by Finance Act 2008 (c. 9), s. 73(5)
F12Words in s. 272(2) Table omitted (with effect in accordance with s. 72(4) of the amending Act) by virtue of Finance Act 2016 (c. 24), s. 72(2)(b)
F13Words in s. 272(2) Table inserted (with effect in accordance with Sch. 5 para. 9 of the amending Act) by Finance Act 2015 (c. 11), Sch. 5 para. 2
F14Words in s. 272(2) Table inserted (1.4.2010) (with effect in accordance with s. 381(1) of the amending Act) by Taxation (International and Other Provisions) Act 2010 (c. 8), s. 381(1), Sch. 7 para. 29 (with Sch. 9 paras. 1-9, 22)
F15Words in s. 272(2) Table inserted (6.4.2014) by Finance Act 2014 (c. 26), Sch. 17 paras. 3(3), 6
F16Words in s. 272(2) Table inserted (with effect in accordance with s. 36(8) of the amending Act) by Finance Act 2018 (c. 3), s. 36(4)
F17S. 272(2) Table: entry relating to Ch. 10A (long funding leases) inserted (with effect as mentioned in Sch. 8 para. 15 of the amending Act) by Finance Act 2006 (c. 25), s. 81, Sch. 8 para. 14(2)
(1)In relation to a property business whose profits are calculated on the cash basis, the provisions of Part 2 (trading income) which apply as a result of section 271E(1) are limited to the following—
| “In Chapter 3 (basic rules)— | |
|---|---|
| section 26 | losses calculated on same basis as profits |
| section 28A | money's worth |
| section 29 | interest |
| In Chapter 4 (rules restricting deductions)— | |
| section 34 | expenses not wholly and exclusively for trade and unconnected losses |
| sections 38 to 42 and 44 | employee benefit contributions |
| sections 45 to 47 | business entertainment and gifts |
| section 52 | exclusion of double relief for interest |
| section 53 | social security contributions |
| section 54 | penalties, interest and VAT surcharges |
| section 55 | crime-related payments |
| section 55A | expenditure on integral features |
| In Chapter 5 (rules allowing deductions)— | |
| section 57 | pre-trading expenses |
| sections 58 and 59 | incidental costs of obtaining finance |
| section 69 | payments for restrictive undertakings |
| sections 70 and 71 | seconded employees |
| section 72 | payroll deduction schemes: contributions to agents' expenses |
| sections 73 to 75 | counselling and retraining expenses |
| sections 76 to 80 | redundancy payments etc |
| section 81 | personal security expenses |
| sections 82 to 86 | contributions to local enterprise organisations or urban regeneration companies |
| sections 86A and 86B | contributions to flood and coastal erosion risk management projects |
| sections 87 and 88 | scientific research |
| sections 89 and 90 | expenses connected with patents, designs and trade marks |
| section 91 | payments to Export Credits Guarantee Department |
| [F19In Chapter 5A (deductions allowable at a fixed rate)— | |
| section 94C | exclusion of provisions of Chapter 5A for firms with partner who is not an individual |
| sections 94D to 94G | expenditure on vehicles] |
| In Chapter 6 (receipts)— | |
| section 96 | capital receipts |
| section 97 | debts incurred and later released |
| section 104 | distribution of assets of mutual concerns |
| section 105(1) and (2)(b) and (c) | industrial development grants |
| section 106 | sums recovered under insurance policies etc |
| In Chapter 6A (amounts not reflecting commercial transactions)— | |
| section 106C | amounts not reflecting commercial transactions |
| section 106D | capital receipts |
| section 106E | gifts to charities etc |
| In Chapter 7 (gifts to charities etc)— | |
| section 109 | receipt by donor or connected person of benefit attributable to certain gifts” |
(2)In those provisions, the expression “this Part” is to be read as a reference to those provisions as applied by subsection (1) and to the other provisions of Part 3.
(3)In section 106D, the reference to subsection (4) or (5) of section 96A is to be read as a reference to subsection (2), (3) or (5) of section 307F (deemed capital receipts under, or after leaving, cash basis).]
Textual Amendments
F18S. 272ZA inserted (16.11.2017) (with effect in accordance with Sch. 2 para. 64 of the amending Act) by Finance (No. 2) Act 2017 (c. 32), Sch. 2 para. 17
F19Words in s. 272ZA(1) Table inserted (with effect in accordance with s. 36(8) of the amending Act) by Finance Act 2018 (c. 3), s. 36(5)