Restrictions: pre-entry loss: anti-flooding rule for pooled assets
- paragraph 3 Schedule 7A treats the actual loss as a loss on the disposal of a pre-entry asset,
- the expenditure actually allowed exceeds the actual cost of the assets to which the disposal is treated as relating, see CG47691
the pre-entry loss is the sum of
- that excess, and
- what the pre-entry loss would be apart from paragraph 4(3) Schedule 7A
except that the pre-entry loss cannot exceed the actual loss.
Note: Additional rules relating to loss buying were enacted in FA 2006. See CG47020+ for guidance on the rules which apply in priority to TCGA92/SCH7A for accounting periods ending on or after 5 December 2005.
FA11/S46 and FA11/SCH11 greatly simplified the rules in TCGA92/SCH7A for the deduction of losses on or after 19 July 2011. See CG47400+ for guidance on loss streaming from that date.