Part 4Loss relief
Chapter 2Trade losses
F1General restrictions on sideways relief and capital gains relief
74AReliefs in any tax year not to exceed cap for tax year
(1)
This section applies if—
(a)
during a tax year an individual carries on one or more trades, otherwise than as a partner in a firm, in a non-active capacity (see section 74C), and
(b)
the individual makes a loss in any of those trades (an “affected loss”) in that tax year.
(2)
There is a restriction on the amount of sideways relief and capital gains relief which (after applying the restrictions under the other provisions of this Chapter) may be given to the individual for any affected loss (but see subsections (7) and (8)).
(3)
The restriction is that the total amount of the sideways relief and capital gains relief given to the individual for all the affected losses must not exceed the cap for that tax year.
(4)
The cap for any tax year is £25,000.
(5)
The Treasury may by order amend the sum for the time being specified in subsection (4).
(6)
If—
(a)
in a tax year an individual makes a loss to which the restriction under section 103C (losses in trade carried on by non-active or limited partner) applies, and
(b)
sideways relief or capital gains relief is given to the individual for that loss,
the amount of the cap under this section for the tax year in the case of the individual is reduced by the amount of that loss.
(7)
The restriction under this section does not apply to so much of any affected loss as derives from qualifying film expenditure (see section 74D).
(8)
The restriction under this section does not affect the giving of sideways relief for a loss made in a trade against the profits of that trade.
(9)
In this section “trade” does not include a trade which consists of the underwriting business of a member of Lloyd's (within the meaning of section 184 of FA 1993).
(10)
For the purposes of this section—
(a)
capital gains relief is, in relation to a loss, the treatment of a loss as an allowable loss by virtue of section 261B of TCGA 1992 (use of trading loss as a CGT loss), and
(b)
capital gains relief is given for a loss when it is so treated.