Part 4

Loss relief
Chapter 2

Trade losses

Restrictions on relief: farming or market gardening

Farming or market gardening
48
1
This section applies if a loss is made in a trade of farming or market gardening in an accounting period (“the current period”).
2
Relief under section 37 is not available for the loss if a loss, calculated without regard to capital allowances, was made in the trade—
a
in the current period, and
b
in each accounting period falling wholly or partly within the period of 5 years (“the prior 5 years”) ending immediately before the current period begins.
3
But this section does not prevent relief for the loss from being available if—
a
the carrying on of the trade forms part of, and is ancillary to, a larger trading undertaking,
b
the farming or market gardening activities meet the reasonable expectation of profit test (see section 49), or
c
the trade was started, or treated as started, during the prior 5 years (see section 50).
4
A loss in a trade is calculated without regard to capital allowances by ignoring—
a
the allowances treated as expenses of the trade under CAA 2001, and
b
the charges treated as receipts of the trade under CAA 2001.