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HMRC internal manual

Business Income Manual

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HM Revenue & Customs
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Trade losses - restriction of relief: non-active traders - basis period straddles, or tax avoidance arrangements predate, 12 March 2008

Sch21 Para7 Finance Act 2008

If the losses arise from arrangement made before 12 March 2008, the absolute prohibition on sideways loss relief does not apply (but the £25,000 annual limit may apply, see BIM85767).

Losses that arise from arrangements made on or after 12 March 2008 under a contractual obligation entered into before that date that the individual does not have the right to vary or extinguish are not affected by the prohibition on sideways loss relief (but the £25,000 annual limit may apply, see BIM85767).

If the losses arise from arrangements made on or after 12 March 2008, and not under contractual obligations entered into before that date, no sideways loss relief is allowed.