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HMRC internal manual

Capital Gains Manual

HM Revenue & Customs
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Deferred consideration: unascertainable: election for treatment of loss - effect of restriction of loss set-off


The overall effect of the provisions described in CG15104 & CG15105 above is, broadly, to provide that no part of the relevant loss is deducted in accordance with TCGA92/S2(2)(b) from the total amount of the chargeable gains accruing to the taxpayer in the later eligible year concerned until after all other available allowable losses (including those which are the subject of earlier elections under TCGA92/S279A, but not those which are the subject of any later elections under that section) have been deducted from that amount.

But, as with any other unused part of an allowable loss that is carried forward for deduction from chargeable gains in a later tax year, the deduction is made before taper relief is applied (for disposals between 6 April 1998 and 5 April 2008), and the carried-forward part of the relevant loss is not used to an extent which would reduce the net amount of chargeable gains below the level of the annual exempt amount for the year in question.