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HMRC internal manual

Business Income Manual

HM Revenue & Customs
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Specific deductions: pre-trading expenditure: relief

S57 Income Tax (Trading and Other Income) Act 2005, S61 Corporation Tax Act 2009

Relief under the above legislation in respect of pre-trading expenditure is only available to the person who incurred the expenditure and commences the trade.

The qualifying pre-trading expenditure is treated as incurred on the day on which the trade, profession or vocation is first carried on. It therefore enters into the calculations of the profit or loss for the first year of assessment in which the trade profession or vocation is first carried on. No separate claim for loss relief is required. Pre-trading loan relationships debits

There are separate rules for pre-trading expenditure incurred by companies which falls into the loan relationship rules. See CFM32100 for more details.