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HMRC internal manual

Business Income Manual

Trade losses - claims to relief: title to relief

Executors, administrators or trustees

A claim to loss relief, other than one for losses in the first four years of trade (S72 Income Tax Act 1970 (ITA 2007)), may be admitted in respect of a business carried on by executors, administrators or trustees. See BIM85010 onwards.


Relief for losses in an employment or office is under S128 ITA 2007 and not under the trade loss relief provisions. However, a claim for employment loss relief should not be admitted unless the loss arises directly from the conditions of the employment (for example, a departmental manager remunerated by a percentage of the profits of their department and responsible for a corresponding percentage of any losses, or a commercial traveller responsible for bad debts arising from orders obtained by him or her). Nor may an employment loss claim be admitted if, and to the extent, that it is made as part of a tax avoidance arrangement.

A deduction from earnings for expenses cannot exceed the earnings from which it is deductible. There is no such limitation in the case of capital allowances because relief is given via Capital Allowances Act 2001 and not via the legislation for expenses. Information on claims by employees for a loss generated by capital allowances is at EIM36890