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HMRC internal manual

Capital Gains Manual

Annual exempt amount: losses

Gains up to the amount of the particular exemption for the year of assessment are not chargeable. For this purpose, gains are described in TCGA92/S3 as the `taxable amount’. The taxable amount is arrived at by deducting from the total gains for the year

  1. the whole of any losses for that year, even if this reduces the net gains below the amount of the exemption, and

  2. losses brought forward to the extent necessary to reduce the net gains to the amount of the exemption, see example at CG18202, and

  3. losses accruing to an individual for the year of his or her death which are carried back to an earlier year, see CG30430, but only to the extent that the net gains of that year are reduced to the amount of the exemption, and

  4. for periods up to 5 April 1990, losses accruing to a spouse as covered by CG22100.