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HMRC internal manual

Capital Gains Manual

Administration: introduction: losses

The deduction of losses from gains is subject to restriction in the case of a`pre-entry loss’, TCGA92/S184A – F and TCGA92/SCH7A. A pre-entry loss is a realisedloss which a company brings into a group, or the pre-entry proportion of the loss on anasset which a company brings into a group. Detailed instructions are at CG47000+.

Note: Additional rules placing a restriction on a company’s allowable losses wereenacted in FA 2006. See CG47020+ for guidance on the rules which apply to losses whichaccrue on or after 5 December 2005.